Proposed Air Canada-United Airlines arrangement would harm competition on key Canada-U.S. routes
GATINEAU, QC, Oct. 28, 2026 /CNW/ — In a report delivered to the Minister of Transport, the Competition Bureau has concluded that a proposed arrangement between Air Canada and United Airlines would likely harm competition on 10 routes between Canada and the United States. The report will inform the Minister’s public interest review of the proposed arrangement.
The proposed arrangement would allow Air Canada and United to expand their coordination, including on pricing, on 10 routes where such coordination is currently restricted by a 2012 consent agreement. The restrictions were put in place after the Bureau concluded that similar coordination between the airlines would substantially harm competition. The restrictions remain in force today.
The Bureau found that the proposed arrangement would eliminate an important source of competition between the airlines on these routes. Air Canada and United currently account for all non-stop passenger traffic on five of the 10 routes and have significant combined market shares on the others. The Bureau’s analysis found that the proposal would likely result in higher prices on most affected routes, resulting in millions of dollars in consumer harm each year.
The Bureau also concluded that barriers to entry and expansion are high and that competition from other airlines would be unlikely to constrain Air Canada and United. As a result, the proposed arrangement would create or reinforce monopoly or near-monopoly conditions on several routes.
Under the Canada Transportation Act, the Competition Bureau must report any competition concerns to the Minister of Transport when certain airline agreements are subject to a public interest review. The Minister will consider the Bureau’s findings as part of that review and ultimately decide whether to authorize the proposed arrangement.
Quotes
“Competition between airlines helps keep fares lower and gives travellers more choice and better service. Our review found that allowing Air Canada and United to coordinate on these routes would likely reduce competition on key Canada-U.S. routes and lead to higher prices for travellers.”
Jeanne Pratt
Interim Commissioner of Competition
Quick facts
- Air Canada and United currently cooperate through their Transborder Joint Business Arrangement, except on 10 cross-border routes where a 2012 consent agreement prohibits coordination.
- The 10 affected routes connect Toronto, Montreal, Ottawa and Vancouver with Chicago, Cleveland, Denver, Houston, New York, San Francisco and Washington.
- In 2025, the Bureau released a market study with recommendations to improve competition in Canada’s airline industry.
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The Competition Bureau is an independent law enforcement agency that protects and promotes competition for the benefit of Canadian consumers and businesses. Competition drives lower prices and innovation while fueling economic growth.
SOURCE Competition Bureau
