Qantas boss Cam Wallace pleads for Aussie workers in row over Virgin Australia, Qatar Airways plane deal

The competition watchdog has pushed aside the protests of dominant player Qantas to flag approval for Virgin Australia’s proposed tie-up with Qatar Airways.

Boosting hopes of 28 extra flights each week from Australia’s four biggest capital cities to Doha, the Australian Competition and Consumer Commissioner said the partnership was likely to result in public benefits and to cause minimal, if any, public detriment.

ACCC commissioner Anna Brakey said the proposed arrangement would likely create enhanced products and services for international travellers, including increased choice of international flights and connectivity.

She made the comments after releasing the ACCC’s draft ruling on plans for Qatar to buy a 25 per cent stake in Virgin and for the Doha-based giant to supply the aircraft and crew for the Australian airlines’ international services.

The ACCC reveals the hottest area of domestic debate are so-called wet leases that involve Qatar Airways providing the aircraft, key maintenance services, pilots and cabin crew for Virgin’s international flights.

Virgin is seeking a five-year authorisation from the ACCC for these leases.

Flight attendant, pilot and former aviation industry workers pushed for tighter time limits on the wet leases, raising concerns about jobs being sent to a low-pay, low-protection jurisdiction.

And in a far cry from its hard-nosed approach to culling 1800 ground crew in 2021, Qantas pleaded Virgin Australia would be able to bypass Australian laws and regulations by using Qatari labour at the expense of Australian jobs.

Qantas is pushing for a time-limit on the Qatar-Virgin wet leases, similar to the two-year cap on the airline’s arrangement with Finnair for flights from Sydney through Singapore and Bangkok to Europe

In his ACCC submission, Qantas international chief Cam Wallace said the wet lease would allow Virgin to schedule services crewed entirely by Qatari pilots and crew, whose pay and conditions were substantially less than Australian crew .

“Virgin Australia will have no incentive to develop its own international services using Australian crew on these routes if it can effectively bypass Australia’s laws and regulations,” said Mr Wallace, a former Air New Zealand executive who joined Qantas in 2023.

“The Qantas Group acknowledges the benefit to consumers and the local aviation industry that would be delivered by Virgin Australia re-establishing its own long-haul capacity but encourages Australian regulators to consider conditions that would ensure that it does so in a way that benefits Australia.”

But the ACCC said that without its proposed arrangements with Qatar, Virgin would be unlikely to commence long-haul services to Middle East, Africa or Europe in the next five years.

The ACCC said that Qatar and Virgin would likely continue their codeshare arrangements. And Qatar would be unlikely to lift its Australian services because it is already at its gateway limits at major Australian airports.

The ACCC also rejected a claim by Qantas that the proposed wet lease arrangement would undermine a bilateral air services agreement between Australia and Qatar.

“Any Australian designated airline may enter into codesharing arrangements, as marketing and/or operating airline, with any other airline,” the ACCC said in its draft ruling.

The final ACCC ruling is expected in March or April.

The tie-up also needs the approval of the International Air Services Commission and Federal Treasurer Jim Chalmers, based on a recommendation from the Foreign Investment Review Board.

Dr Chalmers said he was yet to receive advice from the board but would be “very, very surprised if I could not make a decision before the Federal election”, due in the next three months.

The ACCC has set a deadline of March 7 for responses to its draft ruling.