The Australian Competition and Consumer Commission does not accept some views put by Qantas, Chief Executive Officer, Mr Geoff Dixon, on Business Sunday, today.
"The ACCC believes that Qantas now has very high degree of market power in the Australian market and that this requires careful scrutiny from the anti-trust regulator", ACCC Chairman, Professor Allan Fels, said today. "Mr Dixon overlooks that I have not come out in favour of price regulation of Qantas, but indicated that there are arguments for and against and that it is a matter for Government to decide.
"The ACCC, in recent months, despite much public discussion has not come out in favour of industry-specific airline regulation along the lines that apply in Canada. The ACCC has simply indicated that it prefers some general changes to the Trade Practices Act 1974, principally a tightening of the mis-use of market power provisions and some ability to take quick action, rather than the five to seven years norm which generally applies in abuse of market power cases.
"In any case these matters will be considered by an independent public review in coming months and Qantas will have a full opportunity to present its view.
"Regarding the Qantas comments on the need to take a global view of the company, the ACCC has always done this. That is why it did not oppose the Qantas/British Airways Joint Services Agreement. Under this Qantas and BA agree on price, capacity, scheduling and other important variables on the 'Kangaroo Route'. This was recently renewed.
"The ACCC shares a global view but does not share any view that Australian consumers or businesses that fly with Qantas domestically should pay for the costs of its international activities. Qantas should not be able to use its domestic dominance and charge high domestic prices to compensate for loss-making international activities.
"It is difficult to know what Qantas is complaining about. The ACCC did not oppose the Qantas acquisition of Impulse Airlines; as indicated above it did not oppose the price-fixing agreement with BA; it did not take action following complaints about Qantas in relation Compass Mark I and Mark II nor in relation to complaints by Impulse about Qantas. It has not taken action against Qantas in relation to very public complaints by Virgin and some others recently. Instead, these recent complaints have been receiving very careful consideration and decision will be reached soon.
"As indicated above the ACCC has not sought price control or industry specific regulation of Qantas along Canadian lines, although no doubt some of these matters will be considered in the ACCC's forthcoming report to the Government about possible guidelines on airline behaviour.
"The only matter where the ACCC took action was to oppose the initial Qantas proposals to acquire Hazelton on the grounds that Qantas would acquire landing rights at Sydney Airport which would have had the effect of blocking the expansion of Virgin Blue's services from Sydney.
"The only major matter of disagreement is the ACCC's proposals for a stronger TPA in relation to all industries.
"The present situation on the misuse of market law, (section 46) is, in the ACCC's view, unsatisfactory. Undeterred by Qantas's comments the ACCC will be putting its view on s.46 to the forthcoming inquiry. If the Act is somewhat strengthened it still would be up to a court to determine whether the ACCC has acted rightly. It is inconceivable that Qantas would not have its rights highly protected under the Act because it would have every opportunity of defending them in a court should any cases arise in the future".