Qantas and South African Airways have been given approval to continue their codeshare, but only until the end of 2014.
The International Air Service Commission (IASC) said that after that date there is a “greater prospect” of the carriers competing directly on one or both Sydney and Perth routes.
Qantas had applied for the codeshare to continue until March 2016.
In a draft ruling isused today, the IASC said there were likely to be “marginal public benefits” in allowing the codeshare until the end of 2014.
After that date however, the codeshare could hinder competition as, assuming current trends in demand continue, the carriers could offer competing services.
“The commission is concerned that it may deter or delay the introduction of competing services, particularly on the Sydney route, and increase barriers to entry,” it said.
Should Qantas apply for a continuation beyond 2014, “the Commission will consider the application in light of developments between now and when the application is received”.
The draft ruling follows a protracted process which saw Qantas apply for a judicial hearing, subsequently withdrawn, following an original decision of the IASC in February not to extend the codeshare beyond the end of this year.
In its new verdict to approve the codeshare until end of the 2014, the IASC said Qantas and SAA must jointly offer a minimum of 13 weekly services each week although tempory reductions may be permitted “in exceptional circumstances”.
Qantas must also provide quarterly updates on sales, available seats and yield on both Perth and Sydney services.
