In 2020, owing to the pandemic, the CMA imposed interim measures on the airlines signed up to the Atlantic Joint Business Agreement (AJBA) to protect competition on UK-US air routes. Besides BA and AA, these include BA’s IAG stablemates Aer Lingus and Iberia, as well as Finnair.
The measures extended commitments made by BA and AA in 2010, following an investigation by the European Commission, until March 2024.
However, the CMA said on Monday (4 April) that due to the pace at which the airline sector is expected to recover from the Covid crisis – necessary for it to complete its investigation into the competition implications of the AJBA – the measures should continue for a further two years.
"The CMA believes its investigation, which can only be completed once the airline sector stabilises, will not conclude ahead of these measures coming to an end in 2024," said the authority.
"This is because the pandemic is having a continued impact on the sector and recovery is taking longer than expected; in particular, the new covid variants in 2021 and 2022 (Delta and Omicron) have severely affected passenger confidence and travel patterns, leading to reduced demand for transatlantic air travel.
"Moreover, UK consumers were only able to begin travelling to the US from November 2021, and all UK travel restrictions were only fully lifted this month.
"The CMA anticipates it will take several years for the sector to become more stable and, as such, it has further extended the timeframe for the AJBA commitments."
Decision welcomed
The rules mean BA and AA must continue to offer four daily airport slots at Heathrow or Gatwick on three UK-US routes until March 2026 – London-Boston, London-Dallas and London-Miami.The London-Boston route has two slots.
The new interim measures, said the CMA, would allow a tender process to take place in autumn 2023, during which independent airlines can apply to operate services using these slots.
A BA spokesperson said: "We welcome the decision made by the CMA to issue further interim measures while the industry continues to recover from the impact of the Covid-19 pandemic."
An American Airlines spokesperson added: “As transatlantic travel continues to recover, American and our Atlantic joint business partners look forward to delivering significant benefits to travellers in the UK and beyond through improved access to cheaper fares, enhanced travel choices, and easier journeys to more destinations through aligned flight schedules and frequencies.”
