Over the past six months, we have seen many airlines not only abuse dominant position but also engage in concerted practices, both of which are against competition laws.* The first such case concerned the Dutch airline KLM, which abused its dominant position by dictating a cut in commission rates to travel agents.
KLM should have contacted its agents and formulated agreements with each. It could have said to travel agents that: “Our company’s decision is to hold travel agency commissions at 9% on our routes where we hold a dominant position, e.g. between Greece and Holland, and to decrease (or cut) commissions on routes where our company does not hold a dominant position and where travel agents have a plethora of choices from other airlines.” Only then would KLM not have abused its dominant position.
All airlines that “announce” a cut in commissions (without previously negotiating a new contract with each and every travel agent they hold an agreement with) exercise concerted practices and abuse dominant positions. Travel and tourism associations certainly are aware of the above and should react accordingly. More than any other, this applies to ECTAA, which in accordance with its founding statutes represents European travel agents.
However, within the Internet we found that “on October 18, 2002, ECTAA, the Group of National Travel Agents’ Tour Operators’ Associations within the European Union, filed a complaint with the European Commission against IATA and IATA member airlines for infringing on European competition law as provided by Articles 81 and 82 of the EC Treaty.”
And from this same site, we quote Walter Krombach, president of ECTAA: “Agents should be given certain rights, for example access to promotional fares available in the Internal Market, the agents’ participation in the IATA decision-making mechanism, as well as the right to fair remuneration and to a 90-day notification period for all changes to remuneration.”
In other words, ECTAA insists in its claim filled with the EU Commission that airlines should have the right to unilaterally dictate conditions: They simply must advise agents 90 days before doing so. In reality, ECTAA betrays travel agents by abolishing favorable, for agents, contractual conditions and asks the competition committee to exempt airlines from competition rules.