Ryanair is also smart about hotels and car rental
According to the Market Authority, Ryanair would leverage the dominant position it holds in the markets in which it operates to extend its power also in the offer of other tourist services (for example hotels and car rental). All the details of the start of the AGCM investigation
The Antitrust is moving against Ryanair which may have abused its dominant position in the air transport market to also gain space in the offer of tourist services such as hotels and car rental, thus damaging travel agencies and consumers.
THE ANTITRUST INVESTIGATION
Therefore the Competition and Market Authority has initiated proceedings against the Irish company "for possible abuse of a dominant position of an exclusionary nature". The press release issued by Piazza Verdi reminds us that Ryanair is the leading operator in scheduled air transport of passengers on national flights and to and from Italy.
According to the Authority, the company would leverage the dominant position it holds in the markets in which it operates to extend its power also in the offer of other tourist services (for example hotels and car rental). All of this, again according to the initial provision, to the detriment of travel agencies – online and offline – and the customers who turn to them to purchase these services. In particular, the carrier seems to hinder the purchase – by agencies – of airline tickets directly from its website and instead allows the purchase only to traditional agencies via the GDS platform under conditions which, however, would be much worse in terms of price, size of offer and post-sale ticket management.
In essence, according to the Authority led by Roberto Rustichelli, Ryanair's behavior would have effects not only on agencies but also on consumers because it would cause "worsening conditions from a quantitative and qualitative point of view" and "unjustified difficulties in managing the booking".
THE PRECEDENTS OF ANTITRUST WITH RYANAIR AND OTHER AIRLINES
However, it is not the first time that the AGCM's lens has focused on air transport. In May 2021, in fact, the Authority imposed a fine of 4.2 million euros on Ryanair for unfair commercial practices and shortly before a similar measure had been taken against easyJet (2.8 million) and Volotea (1 .4 million). The company had not reimbursed consumers for the cost of tickets for flights canceled after 3 June 2020, as the travel restrictions linked to the Covid 19 emergency no longer apply. According to the Authority, the three companies had engaged in "seriously incorrect and not compliant with the standard of professional diligence" because – once the travel restrictions due to the pandemic were over – they canceled numerous flights scheduled and offered for sale, always using the reason of the health emergency and continuing to issue vouchers, thus avoiding refunding the cost of canceled tickets.
Furthermore, the Competition and Market Authority challenged Ryanair for a misleading advertising campaign, spread through the main media, which talked about the possibility of changing the flight for free while the company applied tariffs for the new flight chosen by the consumer. higher than those that were simultaneously charged on its booking system.
Last December the Authority then started an investigation against Ryanair itself and also Wizz Air, EasyJet and Ita, the main airlines offering national air transport services to Sicily. In addition to Codacons, the Sicilian governor Renato Schifani also raised the issue of air ticket prices especially around the Christmas holidays. The four carriers, as highlighted by the Antitrust in the opening provision, present "a number of frequencies operated which varies from route to route but which, with reference to the most relevant routes (such as Milan/Palermo and Milan/Catania and Rome/Palermo, and Rome/Catania), can reach a total of up to 20 daily flights per route". The objective of the investigation is to understand whether the increases in air ticket prices are "the result of collusive behavior between air carriers, possibly facilitated by the use of price algorithms, rather than a rational adaptation to market conditions".
WHAT HAS THE GOVERNMENT DECIDED ON THE EXPENSIVE FLIGHTS
In the meantime, the government's work continues to address the issue of expensive flights to the islands. With an amendment to the Asset decree, being examined by the Senate, also to avoid any objections from the European Commission, Palazzo Chigi has eliminated the price ceiling (200% of the average cost) which had alarmed the airlines. The proposed amendment provides that, to limit the use of algorithms, greater powers will be entrusted to the Antitrust Authority which will have to verify whether the ticket price is unfair based on the principles of abuse of a dominant position and agreements restricting competition.
The Ministry of Business and Made in Italy defended the amendment which "entrusts" Piazza Verdi with "the concrete examination of the speculative phenomenon, providing it with penetrating powers". The unions are not of the same opinion, speaking of a "backtrack" (Filt Cgil Sardegna) and of an "uncourageous move" (Uil Trasporti Sardegna), nor are the consumer associations with the UNC which asks that "the Antitrust can intervene not only for abuse of a dominant position or agreement restrictive of competition, but also for unfair commercial practice", Codacons which defines the measures as "watered down" and "not capable of truly protecting Italian consumers" and Assoutenti which speaks of innovations "not yet sufficient to overcome the critical issues of the sector".
This is a machine translation from Italian language of a post published on Start Magazine at the URL https://www.startmag.it/smartcity/ryanair-antitrust/ on Wed, 20 Sep 2023 06:50:37 +0000.