Qantas has received provisional approval for its alliance with Dubai-based Emirates which will lead to the Australian carrier ending its long-standing relationship with British Airways.
The Australian Competition and Consumer Commission (ACCC) said the benefits of the tie-up – such as coordinating ticket prices and schedules – would outweigh the reduced competition.
"The ACCC considers that the alliance is likely to result in material, although not substantial, benefits to Australian consumers," ACCC chairman Rod Sims said in a statement.
"The main benefit arising from the alliance is an improved product and service offering by the two airlines to their customers."
If the tie-up goes ahead, Qantas will withdraw from its existing relationship with BA.
Emirates president Tim Clark said that the positive response from its customers had been matched with enthusiasm from the local tourism sector.
"The feedback since the Emirates and Qantas partnership was announced has been positive and reinforces what a strong match the two brands are for each other," he said.
The ACCC will make a final decision in March.
