Korean Air gets approval from the EC on Asiana merger

The European Commission (EC) announced its approval of Korean Air’s business combination with Asiana Airlines on February 13.

This approval comes in the form of conditional clearance, which is subject to the airline’s compliance with certain commitments agreed upon with the EC.

As a result, Korean Air has now successfully obtained approval or completed the review process with 13 of the 14 regulatory authorities requiring business combination approvals.

Korean Air initiated a pre-consultation process with the EC in January 2021, followed by the submission of a formal merger notification in January 2023.

The EC opened a Phase II review of the merger in February, and issued a Statement of Objections in May in which the EC expressed competition concerns resulting from the merger in both passenger and cargo markets.

For the implementation of the cargo commitments, Korean Air and Asiana Airlines will need to take several steps, such as appointing an advisory firm to oversee the divestment of Asiana Airlines’ cargo freighter business, as well as initiating the bidding process, and selecting a buyer of the cargo business.

The approval by the EC of the selected buyer is required to close the airlines’ merger deal.

Once Korean Air completes the acquisition of Asiana Airlines, the actual cargo divestment process will take place.

Under the passenger commitments, T’way Air has been appointed as the “remedy taker” on the designated European passenger routes.

Starting from the second half of this year, T’way Air will gradually initiate operations on the four routes: Seoul Incheon-Paris, Seoul Incheon-Rome, Seoul Incheon-Barcelona, and Seoul Incheon-Frankfurt.

Korean Air plans to provide comprehensive support to T’way Air.