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Green light for Virgin Australia China and Hong Kong

August 14, 2017 Headline News No Comments Email Email

The Australian Competition and Consumer Commission (ACCC) has authorised Virgin Australia to coordinate airline services for five years with the HNA Aviation Group, Hong Kong Airlines and Hong Kong Express Airways.

“The Alliance Framework Agreement may see additional airline services operate between Australia and mainland China, and Australia and Hong Kong,” the ACCC stated.

“The ACCC considers the alliance will likely realise significant public benefits, primarily through supporting the introduction of new services between Australia and mainland China and Hong Kong including by Virgin,” ACCC Commissioner Roger Featherston said.

Virgin has already started five times weekly services between Melbourne and Hong Kong under an interim ACCC authorisation.

The Australian carrier and Hong Kong Airlines share codes to 11 destinations across their flight network and have an interline agreement to 10 mainland China destinations. AirineRating.com notes also that there’s some reciprocity between the Velocity and Fortune Wings Club frequent flyer programs.

Virgin Australia plans to launch services between Australia and mainland China using A330 aircraft. Beijing or Shanghai are considered potential destinations.

The airlines will coordinate their international passenger transport services such as code-sharing, frequent flyer program participation, lounge access, route planning, and scheduling.

“The ACCC considers that the alliance is unlikely to result in any significant public detriment as there was unlikely to have been any material overlap between direct flights operated by Virgin and any of the other airlines in the short to medium term without the alliance in place,” Featherston said.

Authorisation provides statutory protection from court action for conduct that might otherwise raise concerns under the competition provisions of the Competition and Consumer Act 2010. Broadly, the ACCC may grant an authorisation when it is satisfied that the public benefit resulting from the conduct outweighs any public detriment.

Written by Peter Needham

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