Flight Centre denies price fixing allegation

Australian travel agent Flight Centre has denied allegations from the competition watchdog that it had tried to induce three international airlines into a price-fixing arrangement.

The Australian Competition and Consumer Commission took its case to the Federal Court in Brisbane on Friday.

Flight Centre’s managing director Graham Turner said the case would be strongly defended.

The ACCC alleges that, on six occasions between 2005 and 2009, Flight Centre attempted to induce international airlines Singapore Airlines, Malaysian Airlines and Emirates to agree to stop directly offering and booking their own international airfares (including over the Internet) at prices less than Flight Centre offered.

It is alleged that Flight Centre’s prices included both the amount collected for the airfare itself (which was then paid to the airlines) plus the commission that Flight Centre retained for its booking and distribution services. The ACCC alleges that Flight Centre provided booking services to the public and distribution services to the international airlines in competition with the airlines’ internal sales divisions.

It is alleged that the purpose and likely effect of the arrangements sought by Flight Centre was to maintain the level of Flight Centre’s commissions. The ACCC alleges that such arrangements constitute price fixing arrangements in contravention of section 45 of the Competition and Consumer Act 2010 (through the former s.45A of the Trade Practices Act 1974).

A directions hearing is listed for 13 April before Justice Logan.

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