The Federal Government of Nigeria has directed domestic airlines to reverse the recent 60% hike in airfares on local trips.
The FGN gave the order following recent investigations by the Federal Competition and Consumer Protection Commission (FCCPC).
The investigation indicates that the airlines might have unanimously agreed on airfare hike during meetings by the Airline Operators of Nigeria.
The Executive Vice Chairman/Chief Executive, FCCPC, Babatunde Irukera, said in a statement issued in Abuja that although the investigation is at its early stage, there is sufficient probable cause to proceed and also provide interim measures to restore a free and undistorted domestic aviation market.
Irukera added that the investigation also confirms that one of the items of discussion during at least one of those meetings was to set a base or minimum airfares.
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 FCCPC boss said the commission’s understanding from the deliberations at the meeting was that the attendees engaged in mutual discussions and exchange of their respective revenue management models which made certain champions of the coordinated conduct impose a base fare or a Minimum Re-Sale Price for their services in a coordinated and contemporaneous manner proceeded to increase their fares to a minimum of N50,000 across all sectors.
Irukera spoke further that, “Specifically, Air Peace, Azman Air and United Nigeria Airlines immediately proceeded with the increase while Arik Airline, Aero Contractors, Max Air, Ibom Air and Dana Airline also followed.
On the contrary, the commission stated that Green Africa Airlines maintained its existing fares between N33,000 and N38,650 but had progressively increased its fares rising to approximately N47,000 on its Lagos-Abuja route on Wednesday, February 23, 2022.
The commission, however, stated that the FCCPA prohibits conduct such as coordination between competitors even on the platform of trade associations.
