Delta and Latam get Brazil's OK on joint venture

Latam has been in Chapter 11 bankruptcy since May but has continued to fly.
Latam has been in Chapter 11 bankruptcy since May but has continued to fly.

Delta and Latam received approval from Brazil's competition authority for their planned joined venture partnership. The approval, which was awarded without conditions, would provide the airlines with antitrust immunity, thereby allowing them to jointly market, schedule and operate flights.

The proposed joint venture has also received Uruguayan approval but still must receive a thumbs-ups from U.S. DOT as well as competition authorities in Chile and elsewhere in South America, before it can be implemented.

Delta and Latam announced their plan to form the antitrust-immune alliance in the fall of 2019 in conjunction with Delta's $1.9 billion, 20% purchase of South America's largest carrier. The carriers already codeshare on select routes in addition to offering reciprocal mileage benefits, reciprocal lounge access and co-locating at airports in New York and Sao Paulo.

Latam has been in Chapter 11 bankruptcy since May, but operations have continued.

While Delta welcomed Brazil's approval of the Latam joint venture application, the carrier might be nervous about the DOT's considerations.

In November, Delta and WestJet abandoned efforts to form a joint venture in the U.S.-Canada market after the DOT said approval could only come if they divest of a combined eight daily take-off and landing slots and New York LaGuardia.

The DOT also planned to require that WestJet provide interline access to any requesting U.S. carriers except United, among other approval conditions that stemmed from the department's concern that the partnership would have diminished competition.

Delta and WestJet called such conditions, "onerous."


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