SAA applies for leniency
In December 2009, SAA applied to the Competition Commission for leniency under the Commission’s Corporate Leniency Policy (“CLP”), which seeks to facilitate the process through which self-confessing cartel members may (and are encouraged to) disclose information on cartel conduct in return for immunity from prosecution. SAA has denied its involvement in fixing prices and pricing strategies during the World Cup.
In its leniency application, SAA provided the Commission with email correspondence from a competitor airline regarding the pricing of flights during the World Cup. According to media reports, the email in question indicated that, in the absence of certainty as to which flights will represent peak demand flights during the World Cup, airlines had the option to either not provide any inventory for sale, or price all inventory at peak-time rates. The e-mail apparently also suggested that air fares would have to be raised to cover various anticipated additional costs.
Following this information, the Commission initiated an investigation against BA/Comair, 1 Time and Mango, SA Airlink, SA Express and SAA to determine whether there has been any collusion between the airlines to increase prices or adopt similar pricing strategies.
Only a firm that is “first to the door” to confess and provide information of cartel activity to the Commission, in accordance with the CLP, qualifies for immunity under the CLP. If SAA is successful in its leniency application, it may, under the CLP, be granted immunity from prosecution by the Tribunal for cartel conduct under investigation.
Nikki Pennel.
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