If antitrust issues are solved, a LATAM plane could be departing from airports soon (Credit: Nina Chantrasmi)
PAL, formerly known as Principal Airlines, dropped the suit without a formal explanation.
In a press release issued on Tuesday, LAN said it had agreed to pay PAL the equivalent of 3.6 million euros in costs and expenses, and that PAL had agreed to desist from future actions against the merger.
LAN and TAM′s US$3.7 billion merger, which will form the LATAM group, was announced in August 2010. Since the announcement, a handful of antitrust issues have emerged with the deal. In January 2011 the Chilean consumer rights organisation Conadecus filed a complaint about it, claiming it would have a negative impact on routes across Latin America.
In September the TDLC imposed 11 conditions on the merger. At the beginning of October LAN and TAM announced they would challenge three of the conditions, at which point PAL filed its own complaint.
PAL disagreed with TDLC′s allocation of flight slots to LATAM at Brazilian airports, claiming it would block new entrants into the Latin American airline market. The airline also questioned the independence of the compliance oversight, as the National Economic Prosecutor′s office (FNE) is outsourcing the work to an external consultant, with LAN paying for the process.
After suspending the deal to investigate Conadecus′ complaint, the TDLC prohibited LATAM from being a member of the same airline alliance as its regional rival AviancaTaca, which is a member of Star. TAM and LAN are members of the Star and Oneworld alliances respectively.
The deal awaits the approval of Brazil′s Council for Economic Defence.
Counsel to TAM
General counsel - Luiz Claudio Aguiar
US
Clifford Chance LLP
Partners Anthony Oldfield and Sarah Jones and associates Anand Saha and Kristyn Walker
Brazil
Machado, Meyer, Sendacz e Opice Advogados
Partners Antonio Corrêa Meyer, Carlos José Rolim de Mello, Raquel Novais and Fernando Tonnani and associates Fabio Falkenburger and Paula Magalhães
Barbosa Müssnich & Aragão
Partner Barbara Rosenberg and associates José Inácio de Almeida Prado Filho and Rafael Smizd
Chile
Cariola, Diez, Pérez-Cotapos & Cía Ltda
Partners Francisco Illanes, Pedro Deutsch and Juan Cristóbal Gumucio
Counsel to TAM′s shareholders
Turci Advogados
Partners Flávia Turci and associates Carlos Fujita and Ana Matsuda
Counsel to LAN
General counsel - Cristián Toro
US
Sullivan & Cromwell LLP
Partners Sergio Galvis, Duncan McCurrach and Juan Rodriguez and associates Carlos Pelaez, Felipe Capella and Rachael Dugan
Brazil
Pinheiro Neto Advogados
Partner Alexandre Bertoldi and associates Vânia Marques Ribeiro Moyano and Roberta Stettinger Bilotti Demange
Chile
Claro y Cía
Partners José Maria Eyzaguirre and Felipe Larraín
Counsel to TAM in the Constitutional Court filing
Cariola, Diez, Pérez-Cotapos & Cía Ltda
Partners Florencio Bernales and Juan Cristóbal Gumucio
Counsel to Pal
Independent practitioner - Mario Fernández
(Latin Lawyer 28.10.2011)
(Notícia na Íntegra)
