Japan approves Korean Air-Asiana merger

In a much needed step, the Japanese government has approved the proposed merger of Korean Air and Asiana.

Image: Korean Air and Asiana Airlines Airbus A380s at Incheon Airport near Seoul (Credit: Wikimedia Commons)

In a release, Korean Air announced the Japan Fair Trade Commission (JFTC) approved the proposed merger of the South Korean carriers following an approval process started in 2021. Since then, the airline was requested by the JFTC to submit remedies on select routes to where the combined market share of Korean Air, Asiana, and their subsidiaries – Jin Air, Air Busan, and Air Seoul – would limit competition.

According to Korean Air, the JFTC did not go through a a competition review for 5 of the 12 overlapping routes on the combined network. However, the combined carrier decided to cede a limited number of flight slots on seven routes – Seoul-Osaka, Sapporo, Nagoya, and Fukuoka, as well as Busan-Osaka, Sapporo, and Fukuoka - to address remaining concerns.

Korean Air also addressed the concerns of the JFTC when it came to the Korea-Japan cargo network, which was addressed with the decision to divest Asiana's cargo business. The completion of the divestiture of Asiana's cargo business is subject to approval and will occur after Asiana is incorporated as a subsidiary of Korean Air.

The approval from the Japanese government is the 12th of 14 jurisdictions Korean Air needs to complete the proposed merger. Two competition regulators of two jurisdictions – the European Union and the United States – still reviewing the proposed merger and have yet to issue their decisions. 

In the Philippines, the proposed merger has already been approved. Korean Air was not required to submit a business combination report.