FCCPC Warns Air Peace Against Obstructing Inquiry Over Alleged Exploitative Fares …Commissions’ Statement Careless- Keyamo

The Federal Competition and Consumer Protection Commission (FCCPC) has said efforts made by Air Peace to explain its price mechanism in a press conference last week was an attempt to obfuscate the issues.

It said that it was also meant to distract the commission from the ongoing inquiry into alleged exploitative ticket pricing among other alleged violations of consumer rights.

But the Minister of Aviation and Aerospace Development, Festus Keyamo, has described the FCCPC’s statement on the airline’s pricing methodology as careless and insisted that  the commission should have contacted the Nigeria Civil Aviation Authority (NCAA).

The FCCPC in a statement signed by its Director, Corporate Affairs, Ondaje Ijagwuyesterday, said insisted that it was investigating Air Peace, the biggest Nigerian carrier after receiving an avalanche of petitions from passengers.

This followed an invitation by the FCCPC which was honoured by the airline’s executives last week, to address allegations of price gouging and poor service delivery.

Air Peace on Friday, during a press conference, wondered the perimeters which FCCPC uses to determine exploitative pricing and gave details of what it spends in a one-hour flight operation.

“In asserting that only the aviation regulatory agency could inquire into its affairs, Air Peace only betrays a terribly poor understanding of both the legal and moral pillars of its operating environment.

“Passengers are consumers of its services. Their rights are inalienable and guaranteed under the FCCPA. It is the basis of FCCPC’ intervention,” the commission said.

It said the inquiry into Air Peace’s pricing practices stems from allegations of unjustified fare increases on advanced bookings for certain domestic routes, lack of transparency in pricing structures and practices that potentially contravene consumer rights and fair competition principles.

Meanwhile, Keyamo, in an interview with Arise News on Sunday said that the statement by the FCCPC which questioned Air Peace’s pricing methodology was careless. 

Keyamo said the agency should have contacted the NCAA.

“I think it was a very careless statement – I say that with all apology – by the agency, making such a statement without consulting the core agency involved in regulation, which is the NCAA. The power to regulate these airlines and for the airlines to inform about their price increase and all of that is domiciled in NCAA; that is the core agency.

“They should have contacted the NCAA for them to look at the books, which we have been doing, so we would have given them facts. But to single out a few airlines that we are struggling to expose to the world for them to get more enhanced capacity, it was a bit careless,” he added.

Keyamo  emphasised that the issue at hand was not one of exploitation but rather the airline industry’s capacity limitations, especially regarding aircraft acquisition and servicing routes.

He said: “What we are facing is a problem of capacity of the airlines to acquire aircraft and to service their routes. Again, we have things that are totally out of our control, which is the issue of the fluctuation of the forex, that affects everything in aviation. Everything in aviation is dollar based.”

He explained that Nigerian airlines spend majorly foreign exchange due to their need to hire aircraft, which he referred to as wet leasing.

“All of these are foreign exchange, and with the fluctuating nature of our naira against the dollar, you will expect that it will affect also their cost of operation. Now, what we are therefore doing is to ensure that we expose them to the markets across the world where they can now access aircraft on very good terms, and this will impact on the prices of tickets and their cost of operation.

“That is what led us to addressing the issue of the practice direction pursuant to the Cape Town Convention. That is the core of the problem of the aviation industry that this president and vice president graciously supported us to get to, and we are there now,” he said.

Keyamo revealed that in January he will be leading a Nigerian delegation to Dublin to meet major airline financiers and discuss how to access aircraft at better rates, a move he believes will positively impact ticket prices and operational costs.

Source: Thisday