Brazil/Chile: Latam Airlines moves against Azul–ECT JV in Brazil

Latin American airline Latam Airlines has sent documents to Brazil’s competition watchdog, the Administrative Council of Economic Defense (CADE), seeking to stop the Joint Venture proposed between its rival Azul (Latam’s main competition in the country) and Brazil’s Postal and Telegraph Company (Empresa Brasileira de Correios e Telégrafos, ECT).

The proposal by Azul and ECT to enter into a joint venture with no restrictions was sent to CADE at the start of September. International courier FedEx and the airline Avianca have already filed objections of their own. Latam now joins them, stating that the operation “will affect the competitive environment … especially because it eliminates the demand from a large national consumer of cargo, as ECT will hire Azul exclusively…” commented law firm Barbosa, Müssnich and Argao .

Azul and ECT have defended their agreement, claiming that the operation would not generate competitive issues in Brazil “since it only involves vertical relationships, without any potential incentive for closing the market.”
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