USDOT To Deny JetBlue-Spirit Exemption Application

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The U.S. Department of Transportation (USDOT) has said that it will deny the exemption application filed by JetBlue Airways Corporation and Spirit Airlines, Inc. to permit them to operate under common ownership prior to the requested transfer.

The two airlines had filed a transfer application requesting that USDOT allow them to combine and operate their international routes under one certificate – the authorization required to provide air transportation.

Earlier, the Justice Department had filed an antitrust lawsuit under the Clayton Act to block the proposed JetBlue-Spirit merger.

DOT said that in light of the Justice Department’s pending litigation, it will continue to separately investigate the transfer as part of its statutory public interest mandate and under its authority to enforce against unfair and deceptive practices and unfair methods of competition.

The investigation will remain open for the duration of the proceeding.

The Justice Department, together with Attorneys General of the Commonwealth of Massachusetts, the State of New York, and the District of Columbia, filed a civil antitrust lawsuit to block JetBlue’s proposed $3.8 billion acquisition of its largest and fastest-growing ultra-low-cost rival, Spirit Airlines.

The Justice Department says that the proposed merger violates the Clayton Act by eliminating the largest, most aggressive ultra-low-cost competitor, grounding Spirit’s most cost-conscious customers, and substantially reducing competition on a significant number of concentrated, overlapping routes that carry millions of passengers.

JetBlue and Spirit compete fiercely today on hundreds of routes serving millions of travelers. By eliminating that competition and further consolidating the United States airlines industry, the proposed transaction will increase fares and reduce choice on routes across the country, raising costs for the flying public and harming cost-conscious fliers most acutely, DOJ says in the lawsuit.

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