The Break-up of Air Berlin Requires Thorough Merger Control

The supervisory board of Air Berlin, which recently declared insolvency, today decided to continue negotiations with Lufthansa and budget airline Easyjet regarding the sale of the airline. The negotiations are expected to last until 12 October. Partial sales of the airline are a possible outcome. Professor Achim Wambach, PhD, president of ZEW and chairman of the Monopolies Commission, offers his view on the negotiations.

“It is good that the relevant bodies want to decide what will happen to Air Berlin as soon as possible. The uncertainty surrounding the future of Air Berlin is detrimental for both the airline’s employees and its customers. Following this decision, it is up to the European Commission to investigate the effect the sale of Air Berlin’s assets would have on competition in the industry. In the past the Commission has shown that, in cases where competition is under threat, it is prepared to prohibit planned acquisitions in the aviation industry or to require buyers to fulfil certain conditions. The Commission would be well-advised to conduct a thorough assessment of the Air Berlin acquisition in order to prevent Lufthansa gaining a dominant position in the market, particularly over German domestic routes. I expect concerns regarding competition will factor into the committee of creditors’ decision.”