The post Singapore’s Competition Commission raises concerns over Air India buy appeared first on TD (Travel Daily Media) Travel Daily.
Tata Group’s acquisition of Air India is likely to run into a regulatory wall in Singapore and now the Indian conglomerate needs to convince that the takeover does not violate the country’s anti-competition laws.
The country’s antitrust body, Singapore’s Competition and Consumer Commission (CCCS) has observed that Air India and Vistara, which is a 51:49 joint venture between Tata Group and Singapore Airlines, are two of the three key market players that operate flights on Singapore-Mumbai and Singapore-Delhi routes, resulting in overlapping of both air passenger and transport routes.
“Both airlines are likely to be each other’s close, if not the closest, competitor,” the CCCS has observed.
Section 54 of the Singapore’s Competition Act, 2004, prohibits mergers that have resulted, or may be expected to result, in a substantial lessening of competition in the country. Competition issues arise under the Act if the merged entity has/will have a market share of 40% or more; or has/will have a market share of between 20% and 40%, and the post-merger combined market share of the three largest firms is 70% or more.
Merging entities are not required to notify CCCS of their merger but they are required to conduct a self-assessment to ascertain if a notification to CCCS is necessary. If they are concerned that the merger has infringed, or is likely to infringe, the Act, they should notify their merger to CCCS. In such cases, CCCS will assess the effect of the merger on competition and decide if the merger has resulted, or is likely to result, in a substantial lessening of competition in Singapore.
The post Singapore’s Competition Commission raises concerns over Air India buy appeared first on Travel Daily.