G.P. Mittal ORDER
Order under Section 27 of the Competition Act, 2002
1. The present information has been filed under section 19(1) (a) of the Competition Act, 2002 ('the Act') by Express Industry Council of India ('the Informant') against Jet Airways (India) Ltd. ('the Opposite Party No. 17 OP-1), IndiGo Airlines ('the Opposite Party No. 27 OP-2), Spicejet Ltd. ('the Opposite Party No. 37 OP-3), Air India Ltd. ('the Opposite Party No. 47 OP-4) and Go Airlines (India) Ltd. ('the Opposite Party No. 57 OP-5), (collectively, "the Opposite Parties"/"OPs") alleging, inter alia, contravention of the provisions of section 3 of the Act.
Facts
2. Facts, as stated in the information, may be briefly noted.
3. The Informant is a non-profit company incorporated under section 25 of the Companies Act, 1956, having as its main object, inter alia, to secure the welfare of the express industry in all aspects. The Informant is stated to be an apex body of leading express companies and has around 29 members, including several international express companies like Blue Dart, FedEx, DHL, First Flight, UPS etc.
4. It is averred in the information that in May 2008, certain domestic Airlines in India connived to introduce a 'Fuel Surcharge' (FSC) for transporting cargo. This surcharge was fixed at a uniform rate of Rs. 5/Kg and came into force on May 15, 2008.
5. It is alleged that although there does not appear to be any legal provision under which such FSC could have been levied by the Airlines, the ostensible reason given was to mitigate the volatility of fuel prices.
6. It has been further stated that the very fact of levying FSC at a uniform rate from the same date itself constitutes an act of cartelization covered under section 3 of the Act. The said cartel of the Airlines is stated to be continuing till date.
7. It is the case of the Informant that although the levy of FSC was ostensibly introduced as being an extra charge linked to fuel prices, it is an admitted fact that when such prices were reduced (as in the past), there had been no corresponding decrease in FSC. It was further stated that FSC has actually been increased by the Opposite Parties again acting in concert and that too, by almost the same rate and from almost the same date. Likewise, FSC has been uniformly increased in the past even without a corresponding increase in the fuel prices.
8. The Informant avers that it drew attention, through its various communications, of the Opposite Parties to the international practice where FSC is benchmarked to an index, which results in logical transparency and suggested that a similar formula be adopted in India. However, this suggestion was ignored by the Opposite Parties who have taken undue advantage of their dominant position and have continued the practice of increasing FSC uniformly, with no correlation to the increase/decrease of fuel prices.
9. The Informant has also averred that even when fuel prices declined substantially, the Airlines had, in concert, uniformly increased FSC. Reference was also made to the various circulars issued by the Opposite Parties to show that FSC prices have been uniformly raised in concert by the same percentage from the same date.
10. It was alleged that freight charges have been uniformly increased by the Opposite Parties in collusion, in the garb of increasing FSC. This increase is stated to be not only detrimental to the int........