ACCC takes Qantas to court
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ACCC takes Qantas to court
AAP
Consumer watchdog takes Qantas to court
SYDNEY
THE Australian Competition and Consumer Commission has launched legal action against Qantas Airways Ltd for allegedly misusing its market power.
The ACCC action claims Qantas engaged in "capacity dumping" on the Brisbane-Adelaide route after Virgin Blue's entry to the market in December 2000.
The action will be heard in the Federal Court in Sydney on June 11.
The competition watchdog alleges that when Virgin Blue began operating two flights a day between Brisbane and Adelaide in December 2000, Qantas increased its own capacity by 50 per cent with an additional daily flight.
"The ACCC has alleged that Qantas engaged in capacity dumping, knowing that the effect of adding substantial capacity between Adelaide and Brisbane and offering fares at or below those of Virgin Blue would be that all competitors on the route would operate at a loss on the route until one of them withdrew capacity from the route," it said in a statement.
"The ACCC alleges that Qantas had the financial resources and strength to sustain the losses longer than its competitors."
It said there was no rationale for Qantas to add capacity while matching the budget airline's ticket prices unless it wanted to eliminate Virgin Blue or deter it from expanding to other routes.
However, the ACCC said it had decided not to pursue a number of other allegations about anti-competitive behaviour by Qantas in the domestic aviation industry since the demise of Ansett in September 2001.
"The ACCC formed the view that the allegations were not supported," it said.
"A small number of matters are yet to be concluded."
-AAP
Consumer watchdog takes Qantas to court
SYDNEY
THE Australian Competition and Consumer Commission has launched legal action against Qantas Airways Ltd for allegedly misusing its market power.
The ACCC action claims Qantas engaged in "capacity dumping" on the Brisbane-Adelaide route after Virgin Blue's entry to the market in December 2000.
The action will be heard in the Federal Court in Sydney on June 11.
The competition watchdog alleges that when Virgin Blue began operating two flights a day between Brisbane and Adelaide in December 2000, Qantas increased its own capacity by 50 per cent with an additional daily flight.
"The ACCC has alleged that Qantas engaged in capacity dumping, knowing that the effect of adding substantial capacity between Adelaide and Brisbane and offering fares at or below those of Virgin Blue would be that all competitors on the route would operate at a loss on the route until one of them withdrew capacity from the route," it said in a statement.
"The ACCC alleges that Qantas had the financial resources and strength to sustain the losses longer than its competitors."
It said there was no rationale for Qantas to add capacity while matching the budget airline's ticket prices unless it wanted to eliminate Virgin Blue or deter it from expanding to other routes.
However, the ACCC said it had decided not to pursue a number of other allegations about anti-competitive behaviour by Qantas in the domestic aviation industry since the demise of Ansett in September 2001.
"The ACCC formed the view that the allegations were not supported," it said.
"A small number of matters are yet to be concluded."
-AAP
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AAP
Qantas rejects ACCC claims
07may02
QANTAS Airways Ltd today rejected allegations from the Australian Competition and Consumer Commission (ACCC) that it abused its market power.
Qantas chief executive Geoff Dixon hit back, accusing the watchdog of damaging legitimate competition in the Australian economy.
The competition watchdog claims Qantas engaged in "capacity dumping" on the Brisbane-Adelaide route after Virgin Blue's entry to the market in December 2000.
Mr Dixon said his company's actions were a legitimate, commercially justified response to Virgin Blue commencing operations on the Brisbane-Adelaide route.
He said the action would be vigorously defended in the Federal Court.
Mr Dixon also joined the recent chorus of business leaders who have accused the ACCC of overstepping its boundaries.
"This action demonstrates the commission's belief that it has the right to force organisations to change their conduct to fit within the Commission's academic perception on appropriate competitive behaviour, regardless of whether the conduct angaged in by the organisation complies with the law as established by Australian courts," he said.
"The commission's action is likely to have a chilling effect on legitimate competition, not only in the aviation industry but across the economy," he said.
"This is not an appropriate use of the powers given to the ACCC and will ultimately result in harm to Australian customers."
AAP
Qantas rejects ACCC claims
07may02
QANTAS Airways Ltd today rejected allegations from the Australian Competition and Consumer Commission (ACCC) that it abused its market power.
Qantas chief executive Geoff Dixon hit back, accusing the watchdog of damaging legitimate competition in the Australian economy.
The competition watchdog claims Qantas engaged in "capacity dumping" on the Brisbane-Adelaide route after Virgin Blue's entry to the market in December 2000.
Mr Dixon said his company's actions were a legitimate, commercially justified response to Virgin Blue commencing operations on the Brisbane-Adelaide route.
He said the action would be vigorously defended in the Federal Court.
Mr Dixon also joined the recent chorus of business leaders who have accused the ACCC of overstepping its boundaries.
"This action demonstrates the commission's belief that it has the right to force organisations to change their conduct to fit within the Commission's academic perception on appropriate competitive behaviour, regardless of whether the conduct angaged in by the organisation complies with the law as established by Australian courts," he said.
"The commission's action is likely to have a chilling effect on legitimate competition, not only in the aviation industry but across the economy," he said.
"This is not an appropriate use of the powers given to the ACCC and will ultimately result in harm to Australian customers."
AAP
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Lets not forget about when QF flew all those Ansett pax for FREE, or is that anti competitive in the eyes of VB cause they should have bought one of their $5 "sit in the hold" fares. Yeeha for the flying G-String.
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Why is the ACCC acting to everything that Branson whines about. If VirginBlue was not part of a larger business empire I would understand the arguments against QF, but VirginBlue is part of a worldwide business empire that would do the same to QF if they had the opportunity. Would Branson also whinge to the ACCC if QF decided that it wanted to enter the music business? I think not as he would try to make life as difficult as possible for them to succeed.
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You need to look at this in the whole to get perspective. Virgin Mobile is under attack by the ACCC at this time. So I would not say it is the ACCC being supportive of Branson's empire.
The ACCC is a publicity hungry Government Regulator largely on an ego trip.
QF have good lawyers, It will make an interesting contest, ego vs law.
The ACCC is a publicity hungry Government Regulator largely on an ego trip.
QF have good lawyers, It will make an interesting contest, ego vs law.
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Unbelieveable!!! What sort of pathetic government sets up a commitee of academics to champion the cause of foreign owned companies, and assist them in plundering only the profitable routes in our country? Until Virgin is Majority Australian owned and is servicing other than "cream" routes, I dont want one cent of my tax going to prop up the ACCC, or Virgin for that matter.
Before any of you clowns jump on saying Virgin is 50% Australian, that is utter rubbish!
It would only take "One share" of Corrigan's "Wharfie Corp" to be held offshore to dilute that percentage, and I wouldn't mind betting that Rich speculated just a touch before his announcement of the merger, and has a few tucked away in the bottom draw in "Old Blighty"... Not suggesting insider trading for one minute though,
That would be illegal, but it would be worthy of our tax dollars to investigate.
All Qantas should have to say in its defence is that it provided the capacity that Fels and the Australian Government robbed from that market, by their bungling of the Ansett crisis at the time. If the capacity QF put on was in similar size to the AN capacity that was lost, then QF should have had government support to assist!
Why is it that when QF expand its services it is "Predatory", but when VB expand, it is worthy of Govt. Subsidy???? As for who determins what is appropriate capacity for a route, how are the Di@kheads in the ACCC going to prove it is over serviced???? They will probably just count empty seats. They obviously have no experience in the airline business. Do they then go to Tamworth and see 4 passengers get off a Dash8, and say, "The Tamworth run has too much capacity, that must be predatory trading!" No, of course they dont... All the while, these Accc clowns will be given a business lesson in court by QFs legal team, while they chew up tax payers dollars, and shareholders profits... How does this promote "consumers rights" you bludgers? My bet? ACCC ends up the loser, and has to pay QFs costs, (out of the tax payers pocket of course).
The ministry For "Tall Poppies" had better wake up to itself, or it will have no Australian Industry to protect!!! Wake up to yourselves and protect Australian business, not foreign interests!!!!!
Before any of you clowns jump on saying Virgin is 50% Australian, that is utter rubbish!
It would only take "One share" of Corrigan's "Wharfie Corp" to be held offshore to dilute that percentage, and I wouldn't mind betting that Rich speculated just a touch before his announcement of the merger, and has a few tucked away in the bottom draw in "Old Blighty"... Not suggesting insider trading for one minute though, That would be illegal, but it would be worthy of our tax dollars to investigate.All Qantas should have to say in its defence is that it provided the capacity that Fels and the Australian Government robbed from that market, by their bungling of the Ansett crisis at the time. If the capacity QF put on was in similar size to the AN capacity that was lost, then QF should have had government support to assist!
Why is it that when QF expand its services it is "Predatory", but when VB expand, it is worthy of Govt. Subsidy???? As for who determins what is appropriate capacity for a route, how are the Di@kheads in the ACCC going to prove it is over serviced???? They will probably just count empty seats. They obviously have no experience in the airline business. Do they then go to Tamworth and see 4 passengers get off a Dash8, and say, "The Tamworth run has too much capacity, that must be predatory trading!" No, of course they dont... All the while, these Accc clowns will be given a business lesson in court by QFs legal team, while they chew up tax payers dollars, and shareholders profits... How does this promote "consumers rights" you bludgers? My bet? ACCC ends up the loser, and has to pay QFs costs, (out of the tax payers pocket of course).
The ministry For "Tall Poppies" had better wake up to itself, or it will have no Australian Industry to protect!!! Wake up to yourselves and protect Australian business, not foreign interests!!!!!
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AAP
Qantas complaints 'over the top': Fels
Qantas complaints about legal action for its increased capacity on the Brisbane-Adelaide route after Virgin Blue entered the market were over the top, ACCC chairman Allan Fels said today.
The Australian Competition and Consumer Commission (ACCC) claims Qantas abused market power, leaving Virgin Blue either to sustain heavy losses or cut back its own capacity.
Qantas chief executive Geoff Dixon said the ACCC was in danger of stifling the competition it was supposed to protect.
Mr Dixon said his company's actions were a legitimate, commercially justified response to Virgin starting operations on the Brisbane-Adelaide route.
He said the action, to be heard in the Federal Court in Sydney on June 11, would be vigorously defended.
"I find the Qantas reaction pretty strange because the commission has been very reasonable to it over the years," Professor Fels told ABC Radio.
"It allowed it to have a price-fixing agreement with BA (British Airways) on the kangaroo route, it allowed it to take over Impulse, it took no action over many complaints we received in the time of Compass Mark I and Mark II, we have never sought price controls, we've never sought industry guidelines for Qantas.
"We did say they couldn't take over Hazelton unless they got rid of some of the slots they were going to get at Sydney Airport, but generally the commission has been very measured and moderate with Qantas."
Prof Fels said this was the first action against Qantas and the ACCC had thrown out numerous outer complaints against Qantas, including by Virgin.
"I think he's (Mr Dixon) going over the top, but he's entitled to defend himself in court," he said.
Prof Fels said he expected Qantas would pour resources into its defence.
İAAP 2002
Qantas complaints 'over the top': Fels
Qantas complaints about legal action for its increased capacity on the Brisbane-Adelaide route after Virgin Blue entered the market were over the top, ACCC chairman Allan Fels said today.
The Australian Competition and Consumer Commission (ACCC) claims Qantas abused market power, leaving Virgin Blue either to sustain heavy losses or cut back its own capacity.
Qantas chief executive Geoff Dixon said the ACCC was in danger of stifling the competition it was supposed to protect.
Mr Dixon said his company's actions were a legitimate, commercially justified response to Virgin starting operations on the Brisbane-Adelaide route.
He said the action, to be heard in the Federal Court in Sydney on June 11, would be vigorously defended.
"I find the Qantas reaction pretty strange because the commission has been very reasonable to it over the years," Professor Fels told ABC Radio.
"It allowed it to have a price-fixing agreement with BA (British Airways) on the kangaroo route, it allowed it to take over Impulse, it took no action over many complaints we received in the time of Compass Mark I and Mark II, we have never sought price controls, we've never sought industry guidelines for Qantas.
"We did say they couldn't take over Hazelton unless they got rid of some of the slots they were going to get at Sydney Airport, but generally the commission has been very measured and moderate with Qantas."
Prof Fels said this was the first action against Qantas and the ACCC had thrown out numerous outer complaints against Qantas, including by Virgin.
"I think he's (Mr Dixon) going over the top, but he's entitled to defend himself in court," he said.
Prof Fels said he expected Qantas would pour resources into its defence.
İAAP 2002
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Price fixing on the Kangaroo route??? Qantas is almost a quarter owned by BA, and is their strongest ally! I would be suprised if they didn't talk to each other about operating the same route
The ACCC has been stomping around revelling in the media frenzy for ages - it'll be interesting to see if there really is any substance behind their apparently egotistical rhetoric.
Competition is great... but where's the competition if Qantas isn't permitted to countermove because it's the 'big mean one' as advertised by Virgin?
Lancer
The ACCC has been stomping around revelling in the media frenzy for ages - it'll be interesting to see if there really is any substance behind their apparently egotistical rhetoric.
Competition is great... but where's the competition if Qantas isn't permitted to countermove because it's the 'big mean one' as advertised by Virgin?
Lancer
