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Sunday, October 1, 2023

Dear Flights, the ceiling on ticket prices will be lifted: the Antitrust will have more powers

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The Italian government is lifting the cap on fares on national flights with Sicily and Sardinia, effectively weakening the system of the early August decree. The move comes after weeks of pressure from airlines – starting with Ryanair – and after informal talks with the European Commission. From Brussels – EU sources explain Courier – they did not mince their words to make Rome understand that as it was written, with the imposition of a cap on the price of airline tickets, the measure was contrary to community rules and that in the coming weeks the country will also have to initiate a procedure of infringement risked the most extreme scenario.

The delegate

“We proposed a revision of the regulations on flight prices in the Asset Decree, also because someone had wrongly interpreted that indication as a ceiling on the fare, but this is not the case,” explains the Minister of Entrepreneurship and Made in Italy , Adolfo Urso, out. on the sidelines of an event. “With the improvements we have made, we have given more powers to the relevant authorities in the sector to create more competitive and transparent market conditions and better protect users,” he explains.

What the rule said

The decree adopted in mid-summer – written after a record increase in airfares on both domestic and international flights in the first half of the year – banned the “dynamic fixing of fares” by companies “if the following conditions are jointly met : : 1) the determination is applied to national routes connecting to the islands, takes place during a period of peak demand due to seasonal influences or in combination with a national emergency, 2) results in a retail price of the ticket or service accessories, 200% higher than the average airfare”.

The news

Now the setting changes. According to the ministry, the government amendment “strengthens the instruments for preventing and combating speculation in the air transport sector” by entrusting the Competition Guarantee with “the concrete investigation of the speculative phenomenon by providing it with pervasive powers.” The Italian Antitrust “will be able to verify the existence of concerted practices or abuse of a dominant position, even if the agreements or coordination are not the “men” but the algorithms commanded by them”.

The “structural measures”

It remains to be understood how the Guarantor will identify this “similarity” between IT systems that not only do not communicate with each other, but are also protected by international standards. “The new provision – the ministry continues – gives the Antitrust the power, after a fact-finding investigation (supervised by strong inspection powers), and where disruptive factors arise in the flight market, to impose structural or behavioral measures that eliminate this disruption. “.

The lens on airport incentives

The ministry also wants to find a solution once and for all to airport incentives for airlines. For this reason, another amendment will be tabled addressing the issue of subsidies provided by operators to carriers. Avoiding competitive distortions also requires maximum transparency about the criteria managers use to allocate incentives.”


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Source: Corriere

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