Even as the Indian aviation regulator, the DGCA, launches inquiry into the cartel-formation by the domestic carriers amidst the concerns being voiced by the parliamentary body against the non-transparent pricing policies of the domestic carriers, there is a an international event to take the lessons from. The Australian Competition and Consumer Commission has found evidence of cartelization among the international airlines and has, till now, slapped penalties worth $100 million on these airlines.
The price cartelization is against the ethics of competition and goes against the principal of providing the lowest air fare to the people in competitive markets. However, it is the unreasonable hike in the prices of the otherwise cheap international Flights which raised the concerns about the airlines coming together to rig the prices in different ways so as to make the customers pay more, if they have to fly on any airline.
The ACCC has acted against the Cathay Pacific and Singapore Airline Cargo in $23 million for penalties. Recently, the Thai Airways International Public Company has been slapped with a $7.5 million fine for violating the Trade Practices Act and another $0.5 million in court fees. Till now, about 13 airlines have admitted to the wrongdoing and been penalized, collectively amounting to $100 million.
The ACCC is also planning to bring a legal case against the travel services provider, Flight Centre Limited, which it claims asked the three international airlines not to directly offer and book at fares lower than those of the agency.
The judgments show that the ACCC is very serious in taking the cases of unfair trade practices and the penalties are of deterring nature to the airlines.