The European Commission has opened a detailed second phase investigation into the proposed acquisition of Ireland’s flag carrier Air Lingus by the Irish low cost carrier Ryanair. The initial investigation of the Commission showed that there are competition concerns in the passenger air transport market. More specifically, the Commission found that the two companies have significant overlapping activities on a large number of European routes and that on many routes they are the only two competitors. This, coupled with the fact that the barriers to entry in the markets concerned are high, led the Commission to conclude that the transaction could lead to elimination of actual and potential competition on a large number of routes and thus to higher prices for customers. At the end of the first phase of the proceedings, Ryanair proposed a set of remedies that the Commission deemed insufficient to remove its competition concerns.
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