Federal Competition and Consumer Protection Commission (FCCPC) has ordered domestic airline operators to immediately discontinue the current implementation of airfare increases pending the outcome of its investigation.
The investigation which is carried out by FCCPC in conjunction with Nigerian Civil Aviation Authority (NCAA), is to tackle consumer-related issues which include high airfares, insensitive flight delays and cancellations and others, in the aviation sector.
This disclosure is contained in an interim statement issued on Wednesday by the Executive Vice Chairman of FCCPC, Mr Babatunde Irukera, in Abuja.
Recall that about 9 days ago, MDB reported of at least 100% increase by domestic airlines for a one-way economy ticket, which was selling for a minimum of N50,000, with air passengers raising serious complaints over the hike.
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Some of the airline operators in defence of the huge increase attributed it to a hike in prices of aviation-related materials, services and foreign exchange.
However, Federal Government through FCCPC and Nigerian Civil Aviation Authority (NCAA), moved to tackle incessant consumer complaints in the aviation industry.
The two government agencies announced the setting up of a joint technical committee to address these consumer-related issues which include high airfares, insensitive flight delays and cancellations and other unfair practices.
Irukera has now said the interim order was in line with Sections 17(a),(e),(l),(s),18(3)(a), 157 and 158 of the FCCP Act, stressing that the commission’s investigations revealed that airline operators in supposedly association meetings discussed multiple industry-wide issues; particularly challenges experienced by their members.
He expressed that credible information revealed that while attendees who engaged in mutual discussions at the meeting, did not arrive at an initial consensus, the meeting ended in a resolution that encouraged or consented to the coordinated conduct despite significant controversy.
FCCPC boss pointed out that the FCCPA prohibits conduct or any coordination between competitors including on the platform of trade associations.
He stated;
Specifically, Section 107 (1)(a) forbids competitors from fixing prices, while Section 108 prohibits any conspiracy, combination, agreement or arrangement between competitors in any manner that unduly restrains or injures competition. Coordination in increasing prices otherwise known as cartel is an unambiguous infringement of the FCCPA. 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.
Irukera noted;
This includes directly or indirectly fixing a charge, fee, rate, fare or tariff and any collusive action. The commission in addition to engaging the relevant stakeholders is entering and dispatching interim orders under Sections 17(a),(e),(l),(s),18(3)(a), 157 and 158 of the FCCPA. Prohibiting the performance or continuation of any agreement or arrangement associated with, or resulting from discussions, deliberations, debates, argument or resolutions of/at any meeting.
He stressed;
Regarding any increase in airfares and or any conduct not necessarily directly in compliance, but in response to changes in the market on account of a compliance by others.
Irukera enjoined scheduled domestic airline operators to ensure strict and prompt compliance with the interim order pending the outcome of the commission’s investigation.
