FLY Modern Ark founder,
Theunis Crous, says the
company has lodged a
complaint with the Competition
Commission to intervene in
a “monopoly” that, he says,
has been created by a longstanding
franchise agreement
between SA Airlink and SAA.
Theunis says the airline
conducted a market feasibility
study, which found the
franchise agreement presented
a significant barrier to entry
for smaller airlines. The
agreement, which came at a
price of R14,5m for SA Airlink,
gives Airlink unlimited use of
SAA’s intellectual property. This
includes access to the SAA
booking system, which allows
Airlink flights to be hosted on
the SAA code.
“The access to their booking
system is priceless and makes
it impossible for any new
entrant who wants to operate
on the same routes as SA
Airlink, to be successful,” says
Theunis.
Theunis has delayed the
launch of domestic routes to
March next year in order to
“create a level playing field”
in the domestic market.
The airline had planned to
launch flights this month,
operating the same routes
that SA Express and SA Airlink
currently offer.
However, Rodger Foster, ceo
and md of SA Airlink, says
since its formalisation over
20 years ago, the SAA-Airlink
franchise agreement has been
submitted to the Competition
Commission several times for
scrutiny.
“On each occasion, it was
found to be fully compliant.”
Tlali Tlali, spokesperson for
SAA, says: “Agreements of
this nature are in pursuit of
commercial interests among
airlines that conclude them
and are invariably supported
by each airline’s business
model. This is a choice
individual carriers make.”
