OREANDA-NEWS. November 14, 2011. Tyumen Regional Arbitration Court confirmed legitimacy of the decision of the Office of the Federal Antimonopoly Service in the Tyumen region (Tyumen OFAS Russia) that “UTair” Airlines” OJSC and “Yamal” Aviation Transportation Company” OJSC exercised concerted actions (Part 1 Article 11 of the Federal Law “On Protection of Competition”), reported the press-centre of FAS Russia.

Earlier Tyumen OFAS Russia analysed air fare documentation and discovered that In June- July 2010 (when the demand for passenger air transportation was at the highest level) “UTair” Airlines” OJSC and “Yamal” Aviation Transportation Company” OJSC fixed approximately the same standard economy air fare on the Tyumen – Sochi – Tyumen, the difference in the companies’ air fare 90 Rubles.

OFAS also discovered that within three years (2008-2010) the companies repeatedly exercised actions that resulted in fixing the same prices. The companies took turns to increase and maintain air fares that were formally different from competitor’s prices by 90 Rubles.

Price increase meets the interests of both economic entities: the increase of air fares in the analyzed period was mainly due to increased profitability. The market shares of the companies are roughly equal. Such behaviour indicates absence of competitive relations and competition for consumers.

Tyumen OFAS Russia issued a determination to “UTair” Airlines” OJSC and “Yamal” Aviation Transportation Company” OJSC to stop violating the antimonopoly law and exercise actions towards protecting competition.

“The companies must compete for consumers rather than reach agreements”, commented the Head of Tyumen OFAS Russia, Mr. Dmitry Shalabodov.

Reference:

Part 1 Article 11 of the Federal Law “On Protection of Competition” prohibits concerted actions on the market if such concerted actions lead or can lead to fixing or maintaining prices (tariffs).

Under Part 1 Article 8 of the Federal Law “On Protection of Competition”, concerted actions of economic entities are actions of economic entities on the market that in their totality meet the following conditions:

1) The result of such actions meets the interests of each of the economic entities in question only under the conditions that their actions were known in advance to each of them;

2) Actions of each of these economic entities were caused by actions of other economic entities and are not the consequence of the circumstances equally affecting all economic entities at the relevant goods market.