Singapore’s competition watchdog has conditionally approved a commercial cooperation between Singapore Airlines and All Nippon Airways, marking a significant step in the proposed partnership.
The decision by the Competition and Consumer Commission of Singapore (CCCS), which was announced 21 March, is also a reversal of its previous concerns that the tie-up between the two Star Alliance members would restrict competition on flights between Singapore and Tokyo.
The commercial cooperation was first announced in January 2020, right before the Covid-19 pandemic hit. At the time, the two carriers had proposed a “metal-neutral” pact, which they believe allow them to widen their partnership beyond Singapore and Japan, to “key markets” such as Australia, India, Indonesia and Malaysia.
It would cover “a broad range of joint fare products, tie-ups between frequent flyer programmes, and aligned corporate programmes”.
The CCCS notes that both SIA and ANA “possess substantial market share” on flights between Singapore and Tokyo, noting in 2023 that while “there is evidence of expansion by an existing competitor”, the agency says the impact on competition “is not conclusive”.
SIA and ANA submitted that the cooperation would lead to benefits, including “improved connectivity” and “enhanced air travel product” for services between Singapore and Japan. They also submit that it would lead to more competitive fares “arising from the elimination of double marginalisation and better fare combinability”.
The CCCS then found that any price and capacity coordination “would restrict competition” on flights between Singapore and Tokyo. It also found that the benefits listed by SIA and ANA “are insufficient to outweigh the competition concerns”
To this end, SIA and ANA provided four commitments, including maintain seat capacity “on an aggregated basis”. The CCCS says that it was sufficiently satisfied that the commitments were able to mitigate the competitive concerns, and gave its conditional approval.
SIA says it welcomes the CCCS’ decision, stressing again that the partnership “will provide customers with more travel benefits, seamless flight connectivity, and access to a wider network”.
“SIA and ANA will announce further details at the appropriate time,” SIA adds.
