AIRLINES – 2009 WORLD WIDE COMPETITION LAW REVIEW

By Lucinda Verster,Robert Legh Tuesday, May 31, 2011
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Since its inception in the mid 1940s, international aviation has depended on a complex web of international agreements; particularly bilateral air services agreements, in order to operate. Those agreements have regulated ownership and control of airlines, capacity and the routes on which airlines may operate internationally. Although international aviation has grown into a major global industry, the impact of the global financial crisis has had a significant impact on the airline industry. 
The International Air Transport Association (IATA) estimates that the airline industry lost over USD10 billion in the 2008/09 financial year. Despite these figures, global air transport still supports USD3.5 trillion in economic activity, and provides employment for 32 million people. In 2008, 2.2 billion passengers and 41 million tonnes of cargo were flown across the globe. 
The number of nations with effective competition laws continues to grow. The growth in the number of nations with competition laws and the cooperative approach that the competition authorities have taken internationally have resulted in the aviation industry being under closer scrutiny by competition authorities world wide than ever before.
The International Competition Network (ICN), the world wide organisation of competition regulators, now has some 100 State competition agencies as its members. National competition authorities have become more organised internationally through their membership of the ICN. The cooperation between agencies fostered by the ICN is now becoming apparent with the growth of multi-agency prosecutions of cartel cases, including in the airline industry. This report covers developments from the period 1 July 2008 to 30 June 2009.

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