Criteria for Judging the Anticompetitiveness of Airline Mergers : Focusing on Korean FSC M&A and US Case Laws

This study aims to deeply analyze the criteria for judging competition restrictions by focusing on the case of the corporate merger between Korean Air and Asiana Airlines, which has emerged as one of the key issues in the aviation industry as of 2024. Korean Air announced a structural change in the domestic aviation industry by acquiring a 63.88% stake in Asiana Airlines, and this merger received conditional approval from the Fair Trade Commission of Korea in 2022. However, due to the international nature of the aviation industry, additional approvals are required from competition authorities in major countries, and as of the end of 2024, approvals were obtained from 13 countries. This paper starts from this background and comprehensively examines the status of the corporate merger between Korean Air and Asiana Airlines, and examines cases of corporate mergers between US airlines and the review criteria. In particular, by analyzing the recent corporate merger case between JetBlue and Spirit Airlines, we focus on how US courts judge consumer rights and competition restrictions in corporate merger reviews. In the JetBlue and Spirit cases, the court focused on protecting consumer rights rather than economic efficiency, and disallowed the merger citing the differences in the roles of the two airlines and the possibility of reducing consumer choice. The acquired company, Spirit, was an ultra-low-cost carrier (ULCC), which provided essential choices to price-sensitive consumers, unlike the LCC (low-cost carrier) JetBlue. The court ruled that such a limitation of choice could seriously hinder competition. In the case of Korean Air and Asiana Airlines, both airlines are large-scale carriers (FSCs) representing South Korea, making them highly replaceable, and concerns about the limitation of consumer choice can be analyzed differently from the JetBlue case. The discussion of the entry barriers to the international market, the possibility of the emergence of new competitors, and how the merger of the two airlines would change competition in long-haul international flights remains an important task. In this regard, the U.S. court and competition authorities are likely to have considered the competitive structure in long-haul international flights and the monopolistic positions of Korean Air and Asiana Airlines as major considerations. This study also analyzed the effects of the structural and behavioral measures imposed by the Fair Trade Commission on the corporate merger of Korean Air and Asiana Airlines. Structural measures require the two airlines to take measures such as returning slots to ease their market dominance on specific routes, while behavioral measures aim to prevent fare increases and service quality deterioration. These measures are devices to alleviate concerns about competition restrictions and protect consumer rights, and are practical solutions to how to manage market changes after the merger. In addition, this study analyzed the standards for airline merger approval by the U.S. competition authorities by examining the case of the merger of JetBlue and Spirit Airlines. Through this, it is possible to examine whether the merger of Korean Air and Asiana Airlines is competition-restrictive, and it is expected that standards for judging competition restrictions in future mergers in the airline industry can be presented.