CCI probes IATA for unfair trade practices

CCI probes IATA for unfair trade practices New Delhi: Fair trade watchdog CCI is probing allegations of anti-competitive practices against the International Air Transport Association (IATA) and its India arm with regard to air cargo transportation services.

A trade association of airlines, IATA accounts for about 84 percent of total air traffic worldwide.

The allegation pertains to cargo agents' being required to seek accreditation from IATA to carry out international air cargo transportation services for the latter's member carriers.

Competition Commission of India (CCI) has ordered its Director General (DG) to investigate the complaint filed by the Air Cargo Agents Association of India.

"... The Commission is of the opinion that the decisions/ resolution prescribing the rate of commission to be paid to the intermediaries or similar other decisions pertaining to prices/charges were prima facie in contravention of Section 3(3) of the (Competition) Act," it said.

As per Section 3 (3), an agreement entered into between enterprises which determine purchase or sale price, directly or indirectly, is presumed to have an appreciable adverse effect on competition.

Going by the air cargo agents' complaint, the practice of accreditation "was without any authority of law".

"This self-acquired regulatory power for registering, accrediting and regulating the engagement of air cargo agents in India is alleged to have enabled Opposition Party 1 (IATA) to indulge in anti competitive activities," it had alleged.

According to the CCI document dated March 21, the cargo agents' grouping has 278 active, 298 associate, 42 allied and nine commercial members.

The Commission said even though IATA is not based in the country, Section 32 of the Act provides extra territorial jurisdiction to investigate matters having appreciable adverse effect on competition in India.

Since many of the Indian airlines are members of IATA, its anti-competitive conduct, if any, can be scrutinised under the Competition Act, it added.

IATA has presence in India through IATA (India) Private Ltd.

PTI