FG directs domestic airlines to reverse 60% increase in prices

The Federal Government on Wednesday, March 2, 2022, ordered domestic airlines to reverse the recent over 60 percent hike in airfares on domestic routes.

It gave the order after investigations by the Federal Competition and Consumer Protection Commission showed that the airlines might have unanimously agreed on airfares hike during meetings by the Airlines Operators of Nigeria, their umbrella body.

The Executive Vice Chairman/Chief Executive, FCCPC, Babatunde Irukera, said in a statement issued in Abuja that it was wrong for competitors to come together and agree to fix price, but stressed that investigations were still going on.

He said, “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.

“In the circumstances, the commission is in addition to engaging the relevant stakeholders 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 of the AON or its members regarding any increase in air fares and or any conduct not necessarily directly in compliance, but in response to changes in the market on account of a compliance by others.”

The FCCPC enjoined “scheduled domestic airline operators to ensure strict and prompt compliance with the interim order pending outcome of the commission’s investigation.”

The commission explained that on Sunday, February 20, 2022, it became aware that domestic airlines purportedly under the aegis of AON, after a series of meetings over a period of three weeks, including the ones on February 17, 2022 and February 19, 2022, discussed multiple industry-wide issues, particularly challenges experienced by AON members.

Irukera added, “The commission’s preliminary investigation discloses the meeting dates of AON to have been on or about February 8, February 17 and February 23, 2022.

“The investigation also confirms that one of the items of discussion during at least one of those meetings was to set base or minimum airfares.

“The commission’s understanding from intelligence so far gathered is that there was significant controversy and or an initial lack of consensus concerning coordinated conduct resulting in setting airfares.

“The commission also has credible information that while attendees at the meeting may not have arrived at a consensus, the meeting ended in a resolution that encouraged, permitted or consented to the coordinated conduct.”

Nigerians in the past few days have been complaining about the hike in airfares which sees the least ticket being sold for fifty thousand Naira.