MRTPC probes low cost carriers for cartelisation

Low-cost carriers have attracted the ire of the Monopolies and restrictive Trade Practices Commission MRTPC that has initiated an investigation on possible cartelisation by them. MRTPC has sou moto directed its investigative arm Director General of Investigation and Registration to probe the role of low-cost airlines and the umbrella organisation, the Federation of Indian Airlines FIA, in fixing the fares and has asked for a report on the same in three months time.

FIA had fixed Rs 500 as the minimum fare on low cost airlines last month, and that seems to have drawn the attention of the commission, which feels that such a move will end up interfering with the rules of free and fair competition, and also works against passengers. The commission has seen this to be a restrictive trade practice that is not in the interest of the consumer, who could be deprived of the lowest possible fares. While airlines have been blaming soaring ATF prices for higher fares as ATF accounts for near 40 per cent of operating costs, when ATF prices did fall down recently, the airlines did not cut down fares citing mounting losses.