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Airlines deny fixing prices

Jan 28 2010 22:26 Sikonathi Mantshantsha

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Johannesburg - Domestic airlines have denied colluding on airfares ahead of the soccer World Cup in four months time.

"Mango was never party to any agreements about pricing," the airline's chief executive Nico Bezuidenhout told Fin24.com.

"We don't collude," said Comair joint chief executive Gidon Novick.

The Competition Commission's announcement of an investigation into possible price collusion in the airline industry came as a shock, said 1Time Holdings chief executive Glenn Orsmond.

Orsmond said his company has "never held any meetings with anybody to discuss pricing".

The commission said it received an application for leniency from the state-owned South African Airways (SAA) for possible collusion.

"In its application, SAA gave the commission e-mail correspondence between the airlines in which there are indications that the airlines might adjust air fares ahead of the World Cup," the Competition Commission said in a statement.

Spokesperson Nandi Mokoena told Fin24.com: "SAA gave us correspondence they believe could amount to collusion among the airlines. We're investigating because we believe a leniency application is much more compelling than third party allegations against a company."

Mokoena said the commission is treating the case as a priority as it wants to send a warning to other businesses not to take advantage of the World Cup to inflate prices.

"That does not mean these parties are guilty," said Mokoena. The commission will try to finish the investigation "as soon as possible".

Mokoena would not be drawn on whether the investigation would be concluded before the World Cup in four months' time.

Other investigations have taken years before a decision was made on whether to prosecute.

The domestic airlines pledged to cooperate with the commission's investigation.

"Anything that helps consumer pricing is a positive step and Mango will co-operate fully with any investigation," said Bezuidenhout.

Asked whether its relationship with parent company SAA would raise concerns about collusion, Bezuidenhout said Mango "never discusses" pricing with SAA.

"We (1Time) have not seen any complaint from the commission, but we'll cooperate fully when called upon," said Orsmond.

Both Novick (Comair) and Bezuidenhout (Mango) also said they have not seen any official complaint or notice of investigation from the commission.

- Fin24.com

 
 
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