The Australian Competition and Consumer Commission (ACCC) is proposing to authorise a unilateral code-sharing agreement between Virgin Australia and Air New Zealand.
Both carriers are seeking authorisation for Virgin Australia to place its code on Air New Zealand’s trans-Tasman flights between the two countries.
“The code-share rights are provided on the condition that Air New Zealand specifies the fares at which Virgin Australia may market and resupply those itineraries,” the ACCC states.
In proposing to approve the partnership, the competition regulator says the arrangement “has the potential” to increase ticketing choices for travellers to New Zealand.
Under the partnership, Virgin Australia and Air New Zealand are looking to jointly provide businesses with discounts, as well as other marketing offers, for Virgin Australia-operated flights between Australia and New Zealand.
The ACCC also notes the proposed codeshare arrangement will not apply to flights where both airlines’ networks overlap. Virgin Australia currently flies to Queenstown in New Zealand from Melbourne, Sydney and Brisbane.
Air New Zealand has a larger trans-Tasman network, with flights to Australia from Wellington, Queenstown, Auckland and Christchurch.
Commission deputy chair Mike Keogh adds: “We consider it unlikely that any significant increase in passenger demand for trans-Tasman services due to this code sharing arrangement would raise airfares.”
The ACCC has also proposed to allow Virgin Australia and Air New Zealand to commence commercial planning for the marketing and sale of Virgin Australia trans-Tasman flights.
The commission is seeking submissions on its draft determination until 8 May, before it makes its final decision.
