UK Competition Regulator Extends Measures On London Slots

The UK’s Competition and Markets Authority says it needs more time to assess the impact of the Atlantic Joint Business Agreement on the UK-US market.

Credit: Jamie Gray / Alamy Stock Photo

British Airways (BA) and American Airlines must continue to offer four daily airport slots on three UK-US routes to competitors until March 2026.

The latest decision by the UK’s Competition and Markets Authority (CMA) forms part of the competition regulator’s investigation into the Atlantic Joint Business Agreement (AJBA), which involves the two oneworld alliance members.

The CMA began investigating the AJBA in 2018 to examine the joint venture’s impact on UK-US routes. Following the scrutiny, the regulator identified possible competition concerns on routes between London and each of Boston, Chicago, Dallas, Miami and Philadelphia. 

In May 2020, the CMA consulted on a new set of binding commitments offered by BA and American to try to resolve the concerns. These included making slots available at London Heathrow (LHR) or London Gatwick (LGW) for up to 10 years as part of a wider package of measures. 

However, as a result of the pandemic’s impact on transatlantic traffic, the CMA opted in September 2020 to impose interim measures until March 2024, when it expects the airline sector to be in a more stable position. The interim measures include the release of slots on the London-Boston, London-Dallas/Fort Worth and London-Miami city pairs.

The government body has now extended this until March 2026 due to the continued impact of the pandemic and the fact that material recovery is taking longer than was anticipated in 2020.

A decision notice published on April 4 said that the CMA was not in a position to complete its investigation in advance of the 2020 interim measures coming to an end in March 2024. However, given the expected recovery in traffic, it expects to have sufficient data and certainty regarding the structure of the market by early 2024.

This means that BA and American Airlines must now continue to offer 4X-daily airport slots at LHR or LGW on 3 UK-US routes until March 2026: London-Boston; London-Dallas; and London-Miami. The London to Boston route has two slots.  

A statement from BA said: “We welcome the decision made by the CMA to issue further interim measures while the industry continues to recover from the impact of the COVID-19 pandemic.”

The latest measures will allow a tender process to take place in autumn 2023, enabling airlines that not part of the AJBA to apply for the slots.