The Indonesia Competition Commission (KPPU) has accepted the application for approval of commercial cooperation between PT Garuda Indonesia (Persero) Tbk (GA) and Japan Airlines (JAL). This was stated in a letter from the Chairperson of KPPU dated 26 February 2025 to the President Director of GA, and asked GA and JAL to fulfil various requirements.

As a background, on 3 October 2024, GA and JAL signed a Joint Business Agreement. This commercial cooperation will enable both airlines to provide more benefits to customers by providing additional flight options, a wider network, better connections, and an enhanced frequent flyer programme. After obtaining Anti-Trust Immunity from the Government of Japan, on 11 November 2024, GA submitted an application for similar approval to KPPU.

Following up on the application, KPPU conducted an analysis with documents and data, and requested information from several parties including the Ministry of Transportation, the Indonesia National Air Carriers Association, and the Association of the Indonesian Tours & Travel Agencies. KPPU also considered the condition of the Indonesia-Japan route after the Covid-19 pandemic, which shows that the market share of direct Indonesia-Japan flights (round-trip) served by GA and JAL has decreased, while the largest market share is currently controlled by All Nippon Airways (ANA). The Indonesia-Japan route, round-trip, can also be served indirectly by other airlines through flight alliances.

As a conclusion to the analysis, KPPU assesses that the commercial cooperation between GA and JAL is still within reasonable limits and does not necessarily have a negative impact on business competition in the aviation sector, especially on the Indonesia-Japan route (return).Therefore, it is concluded that the application for approval can be accepted with the conditions that GA and JAL are required to do several commitments:

1. to implement commitments to not reduce flight capacity and frequency;
2. to increase efficiency and improve services to passengers;
3. to avoid clauses in commercial cooperation that prohibit/restrict the parties to cooperate with airlines other than the parties;
4. to report on the implementation of cooperation and commitments periodically every 4 (four) months to KPPU which includes flight frequency plans (including flights that are carried out and not carried out), revenue, gross profit, and when there are changes in policies that have an impact on the implementation of the cooperation.
5. to submit a published annual report.

KPPU will also supervise the implementation of the commercial cooperation, so that at any time it can request related information and data. Furthermore, if there are allegations of violations of Law No. 5 Year 1999 in the future, either as a result of information and data discrepancies or due to the behaviour of GA and/or JAL, KPPU will still conduct research and/or investigations, and the acceptance of this approval application cannot be a reason to exclude their behaviour.

"This cooperation must result in greater benefits for consumers and the aviation industry as a whole. It is expected that they can create better, more efficient services, and provide more alternatives for consumers in choosing flights to and from Japan. Most importantly, it does not close the opportunity for other airlines to compete fairly in the Indonesia-Japan round-trip flight market." explained Ifan, the Chairperson of KPPU.