The Federal Competition and Consumer Protection Commission(FCCPC) has frowned at the increase in air fares by some domestic airline operators under the aegis of the Airline Operators of Nigeria (AON).
A statement signed by the Executive Vice Chairman/Chief Executive of the commission, Babatunde Irukera, revealed that the airline operators made an upward review of their fares to a minimum of N50,000 across all routes.
Irukera stated that “The Federal Competition and Consumer Protection Commission (Commission) became aware that domestic airlines purportedly under the aegis of the Airline Operators of Nigeria (AON) (a trade association for domestic airlines under the Federal Competition and Consumer Protection Act, 2018 (FCCPA)) after a series of meetings over a period of three weeks”.
Babatunde in the statement explained that the association meetings deliberated on issues bothering on challenges experienced by AON members, foreign exchange, cost of ground handling services, rising cost of jet fuel and air fares.
The FCCPC Boss described the coordinated rise in air fare as an unambiguous infringement of the commission’s Act, which according to the commission, prohibits coordination, agreement or cooperation between competitors in setting fares
“The FCCPA prohibits conduct or any coordination between competitors including on the platform of trade associations. Specifically, Section 107 (1)(a) forbids competitors from fixing prices, and Section 108 prohibits any conspiracy, combination, agreement or arrangement between competitors in any manner that unduly restrains or injures competition.
“Further, the current and prevailing Nigerian Civil Aviation Regulations (Air Transport Economic Regulations) in Regulation 18.15.2 (i) and (iii) expressly prohibits airlines from engaging in any contract, arrangement, understanding, conspiracy or combination in restraint of competition which includes directly or indirectly fixing a charge, fee, rate, fare or tariff and any collusive action” Irukera said.
The commission in collaboration with the Nigerian Civil Aviation Authority (NCAA) has however launched an investigation into the matter.
“Although the investigation is at early stages, there is sufficient probable cause to proceed and also provide interim measures to restore a free and undistorted domestic aviation market” Irukera noted.
He urged all scheduled domestic airline operators to ensure strict and prompt compliance with the Interim Order pending outcome of the Commission’s investigation.