THE South African Competition
Commission has referred SA
Airlink to the Competition
Tribunal for prosecution. This
is on charges of ‘excessive
and predatory pricing’ following
complaints lodged by lowcost
carrier Fly Blue Crane,
businessman Khwezi Tiya,
and the OR Tambo District
Chamber of Business between
2015 and 2017, regarding the
Johannesburg-Mthatha route.
Allegations lodged by the
aggrieved parties’ claim
that SA Airlink’s prices were
excessive before Fly Blue
Crane entered the route, and
were lowered to below cost
subsequent to Fly Blue Crane’s
entry. Upon Fly Blue Crane
exiting the route, SA Airlink
allegedly resumed its initial
costing.
The investigation that
followed found that SA
Airlink had contravened the
Competition Act by abusing its
dominance from September
2012 to August 2016, and
that its exorbitant pricing was
to the detriment of travellers
who would have saved
between R89m and R108m.
“The predatory pricing
conduct of SA Airlink
contributed to the exit of Fly
Blue Crane, and the effect of
the predation is also likely
to deter future competition
on this route from other
airlines,” the Commission
stated.
Airlink ceo and md, Rodger
Foster, said: “Airlink has, and
will continue, to co-operate
fully and openly with
South Africa’s competition
authorities. We deny the
allegations and welcome
the opportunity to put our
case before the Competition
Tribunal so that the matter
can be put to rest. We are
confident our conduct has
been, and remains, in full
compliance with competition
rules and the law.”
Airlink would not take
questions on the matter, so
as not to prejudice the case.
The Commission is seeking
an administrative penalty of
up to 10% of Airlink’s annual
turnover, as well as for the
tribunal to offer remedies to
correct the conduct.
