Kingfisher-Jet Airways deal on MRTPC radar

New Delhi: Jet and Kingfisher should have thought twice before jumping into bed as some anti-competitive elements of their alliance could expose them to regulatory scrutiny, say competition law experts. Route rationalisation — a key aspect of their arrangement — could directly impact competition in routes where both airlines have significant presence now, they said. The arrangement gives the combine control of over 60% of the domestic civil aviation industry.
Officials of the Monopolies and Restrictive Trade Practices Commission (MRTPC) have started looking into reports about the alliance to seek more information from the companies about possible anti-competitive nature of some parts of the agreement.
Although provisions of the competition law requiring prior approval from the competition regulator for mergers are yet to be notified, the arrangement announced late on Monday could still come into the scrutiny. Unlike mergers, such agreements are usually examined after they come into force.
The Competition Commission of India (CCI) could also look into the agreement once it gets enforcement and adjudication powers. As of now, the CCI lacks the teeth since it does not have a chairman or members and its powers have not been notified.
15/10/08 Gireesh Chandra Prasad/Economic Times

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Categories: Jet Airways Oct 2008, Kingfisher Oct 2008