Competition between Canada and Europe is under serious threat, and nothing announced this week – neither the proposed sale of Westjet, nor the merger of Air Canada and Air Transat – makes the situation any better. That will put enormous pressure on Transport Minister Marc Garneau if and when the proposals hit his desk.

First, a bit of background.

This summer, according to an analysis done by Air Transat, there will be more than 5.5 million seats flown between Canada and Europe, an increase of eight per cent over 2018. That number is tempered somewhat because of the grounding of the Boeing 737 Max, that scuppered routes such as Halifax-London-Heathrow, but in terms of overall capacity, the Max crisis has little effect on the big picture.

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The trans-Atlantic market is particularly hard to serve. While you can fly relatively cheap 737s and A320s within Canada, if you’re an airline and you want to fly overseas, from most of the country you need long-range aircraft, usually twin-aisle planes that seat 250 people or more. You also need special training, procedures, and approvals to fly so-called extended twin operations (ETOPS). Only a limited number of people have pockets deep enough to buy and fill that kind of metal.

If the Air Canada-Transat deal goes ahead, one company will have enormous power at both the premium and low-cost ends of the market.

Data compiled by Air Transat show that this summer, Air Canada will control 43% of seats to Europe, Transat 20%, and Air Canada joint venture partner Lufthansa six per cent. That’s a whopping two-thirds of the market, a commanding position by any measure.

The main competition, rallied around Westjet and its partners Air France-KLM, has a comparatively paltry 17% of seats going to Europe this summer.

Between them, the two alliances will control 86% of the seats crossing between Canada and Europe, leaving scraps for the likes of Sunwing, Icelandair and British Airways, among others, which only serve a few select cities in Canada.

As the Centre for Aviation said in a 2016 report, “The benefits to airlines that form immunised joint ventures are those that stem from what is effectively legalised internal collusion: less competition and greater pricing power.”

It has to be said, if the tables were turned and Westjet were buying Air Transat, this wouldn’t be as much of an issue. Combined, they and their partners would hold 37% of the market, enough to ensure healthy competition, though the overall concentration would still be a concern.

Air Canada chief executive Calin Rovinescu says Canadians “will benefit from the merged company’s enhanced ability to participate as a leader in the highly competitive leisure travel market globally.”

Yes and no.

While Rovinescu is right to claim the market to sun destinations from Canada is healthy, with plenty of competition and ways to fly south, the picture is much different to Europe, where the majority of capacity is deployed in the summer months.

With the collapse of Wow Air this spring, Canadians are already seeing less competition to Europe, and the AC merger would make the situation even worse. The best option for Canadians searching for deals would be to backtrack to the United States and connect there, but even south of the border, concerns are mounting about diminishing competition.

If the deals pass muster with shareholders and the courts, Garneau would likely have to decide if the transactions raise public interest concerns, and get input from the Competition Bureau. It would be a mistake if he didn’t put the airlines under the microscope.

The same process is being used right now to evaluate the proposed merger of First Air and Canadian North. The bureau has already said it would harm or eliminate competition in most of Northern Canada, though the minister has yet to weigh in.

“I hope the Competition Bureau steps in,” said Gabor Lukacs, of Air Passenger Rights Canada who advocates for passenger rights in Canada, referring to the Air Canada-Air Transat proposal.

In reality, what are the options? Garneau or the competition bureau could turn the merger down, likely throwing the future of Transat into the arms of Westjet. That’s a doubtful outcome, and politically risky for a politician from Montreal, where both Transat and Air Canada are based. Quebeckers don’t like to see their home-grown companies in the hands of les anglais.

Garneau could approve the deals and decide to let the market sort it out.

Or he could open Canada to real competition. Why not treat our airlines like the grownups they are? Remove foreign investment restrictions and let others compete in our airspace, called cabotage.

Canadian travellers will be the winners or the losers out of this whole process, and it’ll probably be up to Garneau to choose.