Qantas Airways has been given initial approval from Australia’s competition authority for its proposed alliance with Dubai-based Emirates.
The Australian Competition and Consumer Commission (ACCC) said the benefits of the tie-up – such as co-ordinating ticket prices and schedules – would outweigh the reduced competition.
It will make a final decision in March.
Qantas and Emirates announced their alliance plans back in September. Neither is investing in the other.
“The ACCC considers that the alliance is likely to result in material, although not substantial, benefits to Australian consumers,” ACCC chairman Rod Sims said in a statement.
“The main benefit arising from the alliance is an improved product and service offering by the two airlines to their customers.”
Qantas is seeking the alliance as it aims to turnaround its loss-making international service.
“A key objective is to make Qantas International strong and viable, and bring it back to profitability,” said Alan Joyce, chief executive of Qantas.
“This partnership will help us do that.”
The tie-up with Emirates will see Qantas end its existing relationship with British Airways.