Virgin Australia has got the green light to deepen its relationship with namesake Virgin Atlantic.
They have been given interim approval by the Australian regulator to cooperate on long haul routes.
The Australian Competition and Consumer Commission authorised cooperation on flights to Ireland and the UK via Hong Kong, Los Angeles and ‘future connecting points.’
If it gets final approval the two airlines would be able to jointly coordinate fares, capacity management and marketing.
They currently have a codesharing agreement and offer reciprocal loyalty benefits.
"We do not think this enhanced cooperation is likely to lessen competition on the routes between Australia and the British Isles," ACCC Commissioner Sarah Court said.
Virgin Australia claims it only has a 10% market share on the Australia-Hong Kong, which is much less than competitors Cathay Pacific and Qantas.
It has backed a decision by the International Air Services Commission to reject a joint business arrangement between Cathay Pacific and Qantas.
Qantas has since submitted a request to reverse this decision.
