Competition Commission to probe possible cartelisation by airlines
24 December 2010
The Competition Commission of India, the country's anti-trust watchdog, has initiated a probe to see whether airlines behaved as a cartel and raised fares in recent weeks.
Taking suo motu notice of the statements by the civil aviation minister, Praful Patel, and media reports, the commission has asked the ministry to share information about the fare hike by the airlines.
Domestic airfares in India had flared during the holiday season, as airlines jacked their spot fares several-fold. Concerned about the steep rise in prices, Patel warned airlines not to fleece passengers. The ministry also directed airlines to post a transparent fare structure on their websites.
Following the government warning, airlines suddenly brought down fares, leading some analysts to suspect a cartel-like approach towards airfares.
The Competition Commission has asked the ministry for details to find out whether the airlines acted like a cartel by raising fares simultaneously.
The anti-trust watchdog has sought details of fare structures from June onwards. The commission had initiated similar action last year, following reports of cartel-like behaviour. But the airlines denied the charges and no action was initiated.