The Australian Competition and Consumer Commission (ACCC) has authorised an alliance between Virgin Blue (ASX:VBA) and Etihad Airways for five years.
The airlines will cooperate on joint pricing and scheduling of flights but will not share revenue.
"The ACCC considers that the alliance is likely to promote competition and result in new international services, in particular between Australia and Abu Dhabi with onward connections to Europe," ACCC chairman Graeme Samuel said today.
Given the airlines do not currently compete on any routes, the ACCC considers the alliance is unlikely to result in any anti-competitive detriments.
Authorisation provides immunity from court action for conduct that might otherwise raise concerns under the competition provisions of the Competition and Consumer Act 2010.
Broadly, the ACCC may grant an authorisation when it is satisfied that the public benefit from the conduct outweighs any public detriment.