SYDNEY, Australia: Citing competition concerns as international travel is soon to resume, the Australian Competition and Consumer Commission (ACCC) has refused to authorize a request by Qantas Airways and Japan Airlines (JAL) to coordinate flights between their two countries.
The Australian regulator was not convinced that the public will benefit from the proposed agreement, which could harm competition, ACCC Chairman Rod Sims said in a statement.
"Preserving competition between airlines is key to the long-term recovery of the aviation and tourism sectors once international travel restrictions are eased," he said.
The ACCC stressed that the agreement will allow the two airlines to coordinate fares and schedules, making it harder for other airlines to fly on routes between Australia and Japan.
Another Japanese airline, ANA, is the only other carrier that offers non-stop flights between Japan and Australia.
"Virgin Australia told us that it will be more difficult to enter the Australia-Japan route if it had to compete with Qantas and Japan Airlines acting jointly, rather than as individual competing airlines," according to the ACCC.
After the regulator announced a draft decision against the proposal in May, Qantas offered to eventually commit to a new service between Cairns and Tokyo.
In a joint statement on Monday, Qantas and JAL expressed their disappointment with the ACCC, stressing they will continue their codeshare arrangements and OneWorld alliance partnership.
"The decision is unfortunate for Cairns, because without the ability to coordinate with JAL, the planned Tokyo flights would not be commercially viable," said Andrew David, domestic and international chief executive of Qantas.
The joint venture with Qantas would have accelerated the recovery of leisure and business travel between Japan and Australia, JAL senior vice president Ross Leggett added.