Korean Air spends over $75.6 million in legal fees for Asiana purchase approvals

Korean Air Lines Co. and Asiana Airlines Inc. [Photo by Kim Ho-young]

Korean Air Lines Co., the national flag carrier, has spent more than 100 billion won ($75.59 million) over the past two years for legal consultations to receive approvals from major countries in its bid to acquire smaller local rival Asiana Airlines Inc.

“Currently, we are operating five teams of experts customized for each major country, each team consisting of 100 people,” said Korean Air. “We have signed contracts with domestic and foreign law firms and companies specializing in economic analysis in order to respond actively to the demands of the competition authorities in each country. We spent over 100 billion won for their services from December 2020 to February this year.”

Korean Air is currently waiting for approvals from the U.S., the European Union and Japan. Korean Air submitted required documents to the U.S. in January 2021 and a second in-depth report in August, but the country extended its decision date indefinitely in November. The U.S. is expected to make its decision after watching the progress and situation in other countries, such as the EU and Japan.

In the case of the EU, Korean Air submitted required reports in January this year, but the EU announced a plan for a second in-depth investigation in February after raising concerns about potential monopolistic issues. Accordingly, the EU is expected to make a decision in August.

The company submitted a draft report to the Japanese authority in August 2021 and started consultations with the country on corrective measures in March, but the consultations are not expected to end until the first half of this year.

Korean Air said that its top management has been leading consultations with the competition authorities in each country since the beginning of the reviews. In particular, the company has made considerable progress in securing and persuading new airlines to enter local routes in consultations with the competition authorities of these three countries, Korean Air said.