Australia's Competition Regulator Proposes to Authorise Virgin-Qatar Airways Alliance

The Australian Competition and Consumer Commission (ACCC) has proposed to grant authorisation to Virgin Australia and Qatar Airways, allowing them to engage in cooperative conduct under an integrated alliance for five years. This alliance, if approved, will enable Virgin Australia to commence 28 new weekly return services between Doha and four Australian capital cities – Sydney, Melbourne, Brisbane, and Perth – using Qatar Airways' aircraft and crew through 'wet lease' arrangements.



The ACCC considers that the proposed cooperative conduct is likely to result in public benefits, including enhanced products and services for air travellers, increased choice of international flights, additional connectivity, convenience, and loyalty program benefits. However, the ACCC is seeking feedback on its draft determination before making a final decision, as some interested parties have raised concerns about the potential circumvention of Australian workforce laws and regulations, and the lack of time limits on the use of Qatar-based crew to operate the new services.

The ACCC has accepted a court-enforceable undertaking from both airlines to protect customers if any of the necessary final regulatory approvals are not granted. This undertaking ensures that customers who have booked the proposed new services will be given the option of a refund or re-accommodation on a suitable alternative flight at no additional charge and would be compensated for any reasonably foreseeable costs.

The ACCC is expected to release a draft determination in February 2025, with the airlines seeking a five-year authorization for their partnership. The ACCC will consider the potential benefits of the alliance against any possible downsides, including the impact on the Australian aviation workforce, before making a final decision.

In conclusion, the proposed Virgin Australia-Qatar Airways alliance is expected to bring significant benefits to consumers, including increased flight options, enhanced travel experiences, and potentially lower airfares. However, the ACCC is carefully considering the concerns raised by interested parties and will make a final decision based on the feedback received and the assessment of the potential long-term implications of the alliance.