Just how far can airlines go in cooperative joint ventures, marketing alliances, or route mergers?

US giant Delta Airlines and Virgin Blue could be about to discover the answer is not very far, because the mood of the US Department of Justice under the Obama administration has already turned sharply against airlines getting together “to improve competition”.

This is despite what shareholders in both carriers would see as obvious, if not urgent, merit in this morning’s announcement that they are seeking regulatory approval from their respective authorities for a joint-venture for their operations between the US, Australia and the South Pacific.

What could be termed “Delta V” would do more than code share each airline’s services and more importantly perhaps, their connecting flights throughout America, Australia, New Zealand and destinations in the Polynesian and Melanesian island states.

It would allow collaboration on route and product planning. Both airlines have the latest in Boeing 777s on the non-stop routes, where everyone is bleeding money in the four-way contest which includes United and Qantas on the non-stop routes. In the wider picture, Air New Zealand, Hawaiian, Japan Airlines and even Cathay Pacific are also aggressively selling on the one-stop alternative routes to the continental US.

Delta has an ultra long range version of the 777 suited to flying deeper into the US than Los Angeles, for which the larger 777 flown by V Australia is the optimally efficient version of that jet.

Virgin’s Pacific Blue “regional” Pacific services have not only done well, but assumed the missionary position in terms of winning the custom of churches whose Pacific island activities generate strong traffic, much of it originating in the US.

In the US the Department of Transportation takes the application but the DOJ makes the ultimate decision based on its oversight of competition and anti trust laws. In Australia the application goes straight to the ACCC, which refused a similar application for merging the Qantas and Air NZ activities on the trans Tasman market which has sustained what the carriers call “unsustainable” competition for around 20 years.

In what could be good news and bad news for Virgin Blue’s largest shareholder Richard Branson, the DOJ has sent negative signals about an application for a similar merger to “Delta V” on the North Atlantic between British Airways and American Airlines.

The DOJ is also resisting moves by Continental Airlines to join the Star Alliance.

In the meantime, Qantas continues to experience the pain of cooperation that amounted to a conspiracy to rob its air freight customers in a cartel with up to 17 other carriers in various parts of the world by participating in a surcharge fixing racket.

A day ago it was fined $168,000 in Canada, which is minor compared to earlier fines of $US 61 million in America, plus the jailing of its US vice president for freight, Bruce McCaffrey for six months, and a $20 million fine by the ACCC in Australia.

Within months Qantas also faces what are expected to be steep fines for participating in the racket in the EU, and will then have to deal with class actions for damages from those it stole from in Australia and the US.