Penalised airlines likely to challenge CCI order

Jet Airways, IndiGo, and SpiceJet were each hit with a penalty for “concerted action in fixing and revising Fuel Surcharge for transporting cargo”, the Competition Commission of India said in a statement. “Else, the fuel surcharge, which was essentially introduced to mitigate the fuel price volatility, will continue to be used as a pricing tool to the detriment of the users who include express companies, freight forwarders and ultimately the end users and thereby will also harm the competition”, the CCI said.

SpiceJet was up 8.44 per cent or Rs 4.05 at Rs 52.05 while InterGlobe Aviation was up 0.97 per cent or Rs 10 at Rs 1045.10.

Indian carriers Jet Airways, IndiGo and SpiceJet, that have been penalised more than Rs 250 crore by the Competition Commission of India, have made a decision to challenge the watchdog’s order.

InterGlobe Aviation operates no-frills carrier IndiGo.

The basic concern is overcharging in the cargo freight segment in the garb of fuel surcharges by the air cargo transport operators, adversely affecting consumers and stifling economic development of the country, CCI said. A Jet Airways spokesperson similarly said the airline “shall pursue all available legal steps to defend its position”.

In a separate filing, InterGlobe Aviation said the company is studying the CCI order and would take legal steps to challenge it in the appropriate forum.

In its complaint, the representative body of express industry alleged cartelisation by the airlines that was in contravention of the provisions of Section 3 of the Act that deals with anti-competitive agreements.

Passing an order on a complaint filed way back in 2013 against five carriers, the fair trade regulator, however, did not impose any fine on Air India and private carrier GoAir.

According to Jet Airways, while the investigation carried out by CCI’s Joint Director General concluded that the allegations levelled against the airlines were not proved.

No penalty, however, was imposed upon Air India Limited as its conduct was not found to be parallel with other Airlines. Jet, IndiGo and SpiceJet have been asked to stop indulging in anti-competitive practices.

DG is the investigation arm of CCI.

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