Codeshare agreement

The next level is called a “codeshare agreement”. In this case one airline sells tickets on another carrier – for example Finnair would sell seats on a Qantas aircraft under a codeshare agreement. Pricing for such an agreement is generally cloaked in secrecy, and codeshares can be either on a “free sale” or “block space” arrangement. Block space is quite rare these days and involves one airline purchasing a “block” of seats on every flight on a particular route operated by another carrier – essentially underwriting the economics of the route because the operating airline always knows it has a guaranteed number of seats already sold for each flight. Competition regulators don’t like this type of arrangement because it’s seen as blocking new entrants. Much more common is a free sale codeshare where for example an Emirates flight would carry Qantas passengers. The Qantas passengers book via Qantas on a QF flight number, but the operating carrier is Emirates.