CCI closes case against IATA; finds no violation of competition norms

New Delhi: Fair trade regulator CCI has closed a case against airlines’ grouping IATA after finding no violation of competition norms.

The International Air Transport Association (IATA) is a grouping of nearly 290 airlines.

In December 2012, Air Cargo Agents Association of India (ACAAI) had filed a complaint with the regulator alleging various anti-competitive practices by IATA with respect to its Cargo Agency Conference and the Cargo Tariffs Conference.

The complaint was filed against IATA and IATA India (Opposite Parties).

In its 36-page order dated March 31, the Competition Commission of India (CCI) said in the present case, the major grievance of the informant (ACAAI) seems to be related to accreditation of cargo agents and introduction of CASS in India by OPs and alleged imposition of unilateral, unfair and abusive conditions by IATA on the cargo agents through its resolutions.

The regulator considered ‘market for account settlement services in respect of air cargo segment in India’ as the relevant one.

“… the Commission is of the considered opinion that OPs did not enjoy a position of strength in the relevant market so as to enable them to operate independently of competitive forces prevailing in the relevant market; or affect their competitors or consumers or the relevant market in their favour.

“As OPs did not enjoy dominant position in the relevant market, question of abuse of dominant position would not arise,” CCI said.

Following the complaint, the watchdog had ordered a detailed probe by its Director General (DG) in March 2013 and the DG submitted the investigation report in December 2014.

After taking into consideration the DG report, the watchdog concluded that IATA had not contravened competition norms and the matter was closed through an order in June 2015.

ACCAI challenged the order before the then Competition Appellate Tribunal, which allowed the appeal and set aside the CCI order in November 2016. The tribunal had also directed the DG to conduct a fresh probe into the matter and return findings on each of the allegations, including that of abuse of dominant position.

The DG submitted another report in June 2018. Later, a supplementary investigation report was submitted in November 2019.

After taking into account these reports, CCI passed the order on March 31.

Welcoming the ruling, IATA, in a statement on Thursday, said the order reinforces the fact that IATA operates in line with the competition laws of India.

It noted that the order also underscores that the introduction of the CASS (Cargo Accounts Settlement System) in India brought benefits to both airlines and cargo agents, bringing economies of scale, standardisation and efficiencies in the settlement process.

“A substantial amount of time and resources have been expended over the years by all parties. Today, the COVID-19 crisis is having a severe impact on the aviation industry, including in India. We hope to be able to move forward from this episode as we tackle the challenges from the COVID-19 crisis,” the statement said.