January 26, 2011 by staff
African Mango, The South African Competition Commission continues to investigate allegations of collusion between the domestic airlines at the World Cup last year. The investigation has been underway for more than twelve months.
Molebogeng Taunyane, external communications coordinator of the Competition Commission, said that six airlines defenceWeb are under consideration, namely South African Airways, British Airways (Comair), 1Time, Mango, South African Airlink and South African Express.
Taunyane could not say when the investigation would be concluded or when the final report would be released. It is also not able to disclose any information regarding the progress of the investigation.
“Once the investigators are satisfied with what they have therefore a report will be released,” said Tuanyane.
The investigation began after South African Airways has applied for clemency in December 2009 in which he agreed to cooperate fully with the commission in exchange for leniency under the Competition Act.
In its application, the PAC has reported on a communication from a competitor – BA (Comair) – relating to 2010 prices. E-mail was sent by Comair joint CEO Erik Venter in response to one of Pule Selepe Department of Transportation, advising the airlines that alleged excessive pricing should be raised at a meeting of the Aviation Sub- Working Group in late 2009. Comair said the email was only intended to inform the debate on price, not influence it. Comair and other airlines SA planned, namely SA Express and 1Time, denied collusion.
Last April, the Commission raided the offices of South African Airways, low-cost subsidiary Mango Airlines and the Airlines Association of Southern Africa (AASA). The operation of search and seizure was prompted by suspicion of the Board that the SAA and Mango may have withheld information affecting their investigation.
If found guilty of fixing prices, airlines face a penalty equal to 10% of annual turnover, Taunyane said.
South African Airways has already been investigated for collusion. It has been four years a survey of the European Commission in setting prices in the freight market. In November of last year, the Ministry of Public Enterprises revealed that the carrier had escaped a fine of € 799,000,000, which was imposed on 11 other air cargo carriers. The airlines were accused of fixing on fuel surcharge and security without rebates over a period of six years beginning in 2000.
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