The US Justice Department is considering suing Korean Air to block its planned acquisition of Asiana Airlines, Reuters reported on Thursday.
The Justice Department has been investigating the deal for nearly two years, and is concerned it could harm competition on United States routes, the report said, citing three people with knowledge of the deliberations.
In response to this report, Korean Air stated that no official decision had been made by the Department of Justice, adding that the South Korean airline would continue its negotiations with the US government until a final decision was made.
“Korean Air has made and continues to make every effort to obtain all necessary approvals,” the company said in a statement.
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According to the report, the US administration is concerned that the merger would leave too much control of the transportation of key goods such as microchips in the hands of a single company, adding that no decision has been made about whether to sue.
On their part, European Union (EU) antitrust regulators said on Wednesday that the proposed acquisition of Asiana by Korean Air Lines could restrict competition in passenger and cargo air transport services between Europe and South Korea.
The merger of South Korea’s No. 1 and No. 2 airlines will make Korean Air the largest shareholder in Asiana.
Analysts said it was too early to tell what the US and EU would decide, but South Korean regulators approved the merger on the condition that the combined company fly other airlines on routes where it has a large market share.
Analysts said Britain’s antitrust authority had mentioned a similar situation when it approved the merger in March.
The Biden administration has taken a tough stance against airline consolidation.
In March, the Justice Department filed a lawsuit to block JetBlue Airways from buying Spirit Airlines, alleging that the estimated $3.8 billion merger would “increase fares and decrease seats, harming millions of consumers worldwide.” Will happen.” hundreds of routes. The trial is set for October.
The department also filed a lawsuit asking a judge to force JetBlue and American Airlines to split their Northeast alliance. After the trial last year, the companies are waiting for the verdict.
