Anticipating these concerns, Emirates and Qantas have already offered a commitment to keep overall capacity between New Zealand and Australia at current levels.

This is one of the three options being considered by the ACCC as a condition of approval. However, the regulator says its preferred option is a capacity commitment covering only the four main major routes where the airlines’ networks overlap. A third option is individual capacity commitments for each of the four markets.

The ACCC says it also wants to require capacity growth in the Australia-New Zealand market. But it acknowledges that there is currently a capacity surplus, so it will not apply this requirement initially. The agency is inviting submissions on both the capacity commitment and the growth requirement.

Qantas and Emirates welcomed the ACCC draft approval, and say they are focusing on responding to the concerns over Australia-New Zealand flights. The carriers plan to begin their partnership in April, and have already begun preparations that do not require regulatory approval, such as connecting IT systems and creating a Qantas operational base in Dubai.