EC Approves Lufthansa's Plans To Acquire Swiss

by Ulrika Lomas, for LawAndTax-News.com, Brussels

07 July 2005

The European Commission announced on Tuesday that it has cleared the proposed acquisition by German airline, Deutsche Lufthansa AG of the Swiss airline, Swiss International Air Lines Ltd under the EU Merger Regulation.

The Commission went on to state, however, that its clearance is conditional upon the parties surrendering slots at Zurich and Frankfurt airports and other concessions. In light of these commitments, the Commission has concluded that the transaction would not significantly impede effective competition in the EEA and Switzerland.

Competition Commissioner Neelie Kroes observed that:

"I welcome airline consolidation in Europe, but it should not lead to higher prices or reduced choice of carrier. The commitments given by Lufthansa ensure that competitors will be able to offer new services in competition with the merged company."

On 20 May 2005, Deutsche Lufthansa AG and Swiss International Air Lines Ltd. notified the Commission of an agreement whereby Lufthansa would acquire the majority of the shares in, and sole control of, Swiss. Lufthansa is the principal airline in Germany and provides air transport of persons, cargo and related services.

Lufthansa is a member of the Star Alliance of airlines. Swiss, created in 2002 on the basis of the existing regional carrier Crossair, is the principal airline in Switzerland and provides air transport of persons and cargo and related services.

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