ACCC approves Qantas-Emirates alliance

Airlines Qantas and Emirates have been given the green light to form a global alliance. Source: AAP

QANTAS and Emirates have been given the green light to form a global alliance, albeit with special conditions for flights across the Tasman.

The Australian Competition and Consumer Commission says the partnership will benefit the public through enhanced products and service offerings.

"The ACCC is satisfied that the alliance is likely to result in material, but not substantial, public benefits," ACCC chairman Rod Sims said.

The ACCC had already given the tie-up interim approval, allowing the two carriers to begin selling codeshare flights between Australia and Europe, North Africa, the Middle East and Asia.

Wednesday's final ruling, which lasts for five years, will also allow Qantas and Emirates to pair up on flights across the Tasman, subject to conditions.

The ACCC said the two airlines would be required to maintain existing capacity on four overlapping trans-Tasman routes - Sydney-Auckland, Melbourne-Auckland, Brisbane-Auckland and Sydney-Christchurch.

"On these routes, the ACCC is concerned that Qantas and Emirates will have the ability and incentive to reduce or limit growth in capacity in order to raise airfares," Mr Sims said.

The requirement to maintain capacity on these four routes - which account for about 65 per cent of all seats between Australia and New Zealand - would be subject to a review to consider whether increases in the minimum capacity were warranted.

"With this condition, the ACCC is satisfied that the relevant net public benefit tests are met," the ACCC said.

Qantas and Emirates also planned to cooperate on sales, marketing and pricing.

The alliance was a key plank in Qantas chief executive Alan Joyce's bid to return the Flying Kangaroo's international operations to profitability.

Under the partnership, Qantas will use Dubai, rather than Singapore, as the carrier's stopover point for its flights to London.

The first Qantas flight to London via Dubai departs on Sunday, March 31.

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