1time refers unfair competition complaint to tribunal

Airline 1time has referred its unfair competition complaint against rival Kulula’s exclusive use of Lanseria Airport to the Competition Tribunal.

1time said in a statement on Tuesday it was unable to fly from Lanseria while the agreement between Kulula and Lanseria Airport was in place.

According to the agreement, only Kulula can use the airport for its regional and domestic flights during the five years to March 2011.

Other airlines need Kulula’s go-ahead to fly to and from Lanseria.

The referral followed the finding by the Competition Commission that the agreement “indeed has the effect of substantially preventing competition in the domestic airline market”.

The commission concluded the agreement “was found to be anti-competitive”.

Despite these findings, after a 19 -month investigation, the commission elected not to refer the anti-competitive practice to the tribunal as it said the agreement was necessary to enable Kulula to break even.

“1time disagrees with the non-referral decision taken by the commission and is hopeful that the tribunal will arrive at a different conclusion,” the airline said.

The effect of existing arrangements was that a large group of passengers was denied a choice of airline and the opportunity to access cheap flights, 1time said.

Kulula passengers would continue to pay 30% more to fly from Lanseria.

“The exclusive agreement will also deny thousands of soccer supporters the opportunity to access cheap flights from Lanseria during the 2010 World Cup,” 1time said. — Sapa

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