Civil Aviation ministry calls meeting to fix airfare violating IATA rules

The Ministry of Civil Aviation and Tourism has called a joint meeting between national flag carrier Biman Bangladesh Airlines and two private airlines -- US Bangla and NovoAir—to fix the airfares in violation of the International Air Transport Association (IATA) rules. 

According to the IATA rules, an airline is barred from sharing its won airfares, product rates and such details with other airlines. 

Moreover, they are not allowed to fix the fares through such meetings. 

Despite the rules, a meeting presided over by State Minister for Civil Aviation and Tourism Md Mahbub Ali is currently underway at the secretariat.

State Minster for Civil Aviation and Tourism M Mahbub Ali Collected

Previously on Monday, a notice signed by Deputy Secretary Mohammad Abdul Awal was issued in this regard. 

The notice was sent to the chairman of the Civil Aviation Authority of Bangladesh (CAAB), Biman managing director and CEO, managing director of two private airlines, and six other ministry officials.
Among the three airlines called into the meeting, Biman is the only one that is an IATA member. 

IATA rules

The IATA strictly prohibits any airlines to openly disclose their own airfare, product rates, individual airline rates, charges or surcharges, individual airline costs, increasing, reducing or reallocating aircraft capacity, and information on individual airline customers.

The association also warns against exchanging information for the purpose of reducing or restricting competition in the airline industry by sharing sensitive commercial or proprietary information that the
company would not disclose in the absence of an express or implied agreement.
It also bars airlines from fixing the airfares among themselves and encourages determining fares based on their business policies in a bid for competitive market growth. 

According to IATA rules, the following types of agreement are strictly prohibited-- any collective agreement concerning prices or charges for airline services, agreement on allocating markets, territories, customers, suppliers or agents.

IATA also bars any agreement that is intended to, or in operation is likely to, induce airlines or their suppliers or agents to engage in collective anti-competitive behaviour, or collectively punish any business enterprise for its exercise of independent business judgment.