The US Department of Transportation (DOT) has granted tentative global antitrust immunity (ATI) to a proposed combined joint venture consisting of Delta Air Lines, Air France-KLM, and Virgin Atlantic.

"The proposed alliance would remove the existing gaps preventing full coordination between Delta’s two parallel joint ventures with Virgin on the one hand, and Air France/KLM on the other," the DOT said.

The DOT also proposed a five-year review period.

In its analysis, the regulator rejected JetBlue Airways's objection and concluded that the new JV would not cause significant change to the competitive landscape on the transatlantic market. Most of the cooperation proposed under the new JV is already immunised under two existing separate JVs.

The DOT also concluded that the acquisition of flybe. (BE, Exeter) by Connect Airways, a consortium including Virgin Atlantic, will not "meaningfully" change Skyteam's market share at London Heathrow. It also recognised that the European Commission ordered Connect Airways to release 5x daily slot pairs at Amsterdam Schiphol available initially for services to Birmingham Int'l but subsequently also for other routes.

"While there is no information in the record indicating that potential competitors are seeking slots for use immediately, given Skyteam's share of slots at this gateway, there is a future possibility that new entry could be effectively foreclosed, and that the Department might need to reassess whether its grant of immunity could be exacerbating a competition concern," the DOT said.

It also refused to consider the potential impact of Brexit on the JV given the uncertainty surrounding the process's timeline and the regulatory framework that will be in place after the United Kingdom has left the EU.

"Brexit is an internal political question of the UK, and the Department will not take the extraordinary step of delaying action on pending applications to await the outcome of that process," the DOT said.

The DOT also tentatively revoked its previous ATIs granted to the applicants. The previous arrangements also included CSA Czech Airlines (OK, Prague Václav Havel) and Alitalia (AZ, Rome Fiumicino), which are no longer part of the applicant consortium.

"As such, the underlying predicate for ATI covering these carriers no longer exists," the DOT said.

However, the DOT explicitly banned the applicants from operating under a single brand unless they apply for separate approval.