Travel agents: Paying commissions to intermediaries can be abusive

“A South Gauteng High Court has awarded Nationwide Airlines (CE, Johannesburg O.R. Tambo) ZAR104.6 million (USD7.89 million) in damages plus interest after ruling that South African Airways (SA, Johannesburg O.R. Tambo) practices did breach South Africa’s Competition Act and did inflict financial harm on Nationwide.

It claimed that between June 2001 and March 2005, SAA had violated the terms of the country’s Competition Act by paying commissions to travel agents thus diverting passengers away from competitor airlines.

In her ruling, Judge Caroline Nicholls said the Competition Tribunal and the Competition Appeal Court had acknowledged the shortcomings in Nationwide’s safety record, they had still determined that SAA’s abuse of its dominant position was ‘the major cause of the decrease in volume of Nationwide’s passengers’.”

Texts from: http://www.ch-aviation.com/portal/news/48474-nationwide-wins-saa-anti-competition-case-awarded-78mn