The European Commission (EC) has set February 19, 2024, as the tentative date for a decision on the merger of Korean Air (KE, Seoul Incheon) and Asiana Airlines (OZ, Seoul Incheon). The EC updated its website on December 6, adding the new deadline. At the same time, one of the EC's top competition bosses told media that the parties were progressing towards solving some of the more contentious merger aspects.
The proposed KRW1.8 trillion won (USD1.37 billion) merger will see Korean Air take a 63.9% stake in Asiana, taking its aircraft and other infrastructure and dissolving the brand. However, the EC has raised concerns about the merger's competitive impact on cargo and passenger routes between South Korea and European airports. In May, the EC sent Korean Air a statement of their objections to the proposed merger. Specifically, the commission had concerns on two fronts, including that the provision of passenger transport services may be reduced on four routes between South Korea and France, Germany, Italy, and Spain and that the provision of cargo transport services may be reduced between all of Europe and South Korea.
Korean Air has since sought to ameliorate the EC's concerns, agreeing to hand over slots to other airlines in four European airports and sell Asiana's cargo business. Notably, Korean's proposed remedies are contingent upon and will only happen if the EC agrees to the merger. In July, at the request of Korean Air, the EC delayed making a final decision.
In early November, Korean Air submitted its proposed remedies, and the EC resumed its decision-making process. This week, Reuters reported EC competition boss Didier Reynders saying the parties were making "very good progress with some proposals." A Korean Air spokesperson says the airline aims to obtain approval as soon as possible.
Competition authorities in 11 key markets have approved the merger, albeit with some jurisdictions securing concessions. However, Korean Air still needs approval from the EC, USA, and Japan. Korean is reportedly pumping considerable resources into securing approval from the US authorities, including proposing that Air Premia (YP, Seoul Incheon) operate flights on the South Korea - US country pair. However, US authorities rejected that offer, saying they wanted an alternative airline at least the size of Asiana.