190 COMPETITION LAW IN TOURISM their competitors. Wizz Air indicates that ‘While the combined market- -strength of the combined carrier may increase, the Transaction itself may trigger for DUB to become more active in attracting new carrier to diversify. There may also be some capacity consolidation which could open up new opportunities for other carriers”. It could be possible that only one potential carrier could actually threat to enter a market, then being necessary to distinguish potential and effective threat. In the case of an imminent threat, there would be clearly plans and willingness for an operator to enter a route and not only a theoretical likelihood. 4.2. Barriers to Entry and the Theory of Mutual Forbearance Mutual forbearance applied to the air transport is not grasped as a tacit agreement under Article 101 TFEU. As regards the control of concentration, the EU Commission must assess whether potential competitors would face possible failure when entering the market. New entrants would require significant upfront investment and would have to face significant commercial risks. The EU Commission evaluates the level of barriers to entry, the level of sunk costs43, the level of risks that would affect the profitability post-entry and the existence of incentives for potential entrants. This would always be easier for a competition authority to demonstrate the absence of actual competition on a route than demonstrating the absence of potential competition. In Aegean/ Olympic II (2013), the question was raised as to whether Cyprus Airways would be an efficient competitor, exerting enough competitive constraint on a possible merged entity Aegean/Olympic Airways. The response was clearly that the features of the mutual restraint assumption were identified in this case: “Therefore, during the (most profitable) high-season of Greek domestic air transport Cyprus Airways decided to exit for the foreseeable future from the Athens–Thessaloniki, Athens–Heraklion and Athens–Rhodes routes. Thus, in terms of actual competition, Cyprus Airways has been clearly removed as a competitive constraint on the Merged Entity post-Transaction”44. Additionally, the EU Commission needs to demonstrate whether a potential entry is likely to be successful. Barriers to entry have been defined, by EU 43 Costs that cannot be recovered in case of failed entry. 44 Para 208.
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