Government rewrites high-flying rules, powers for the Antitrust. The rules apply for connections with Sicily and Sardinia


By John

The government rewrites the law against expensive flights. In an amendment to the assets decree the executive eliminates the price cap (200% of the average cost) and to limit the use of algorithms entrusts powers to the Antitrust which will verify any unfairness of the airline’s price, based on the principles of abuse of dominant position and anti-competition agreement. The conduct practiced on the routes to the islands, the period of peak seasonal demand and the prices 200% higher than the average flight fare – it is written in the technical report – are considered circumstances and indications which the Authority can take into account. The amendment, however, prohibits “the use of automated procedures for determining rates based on the user’s web profiling activities or on the type of electronic devices used for bookings, when this causes prejudice to the user’s economic behaviour”explains the explanatory report.

The rules apply for connections with Sicily and Sardinia but also for other national routes «in the presence of a national state of emergency or if road or rail travel along the national territory are, in whole or in part, prevented by exceptional events declared by public authorities”. The Antitrust will have the power, following a fact-finding investigation (supervised by strong inspection powers), to impose, where distorting factors emerge in the flight market, structural or behavioral measures that eliminate such distortion. It is envisaged that for the purposes of adopting the measures, the Authority must take into account the structure of the market; of the methods of defining prices, also through the use of revenue management systems and algorithms; the risks for the competitive process and for consumers deriving from the use of algorithms based on artificial intelligence or user profiling; of the competitive and price dynamics linked to the seasonality of demand; the needs of territories that are difficult to reach by means of transport other than air; of the need to protect particularly vulnerable classes of consumers.

Furthermore, the amendment increases thetransparency and knowledge of the criteria used by airports for granting subsidies for route development, attributing new monitoring powers in this case to the Transport Regulatory Authority. Finally, to better inform consumers, the Antitrust will publish on its website a document, constantly updated also with the rulings of the Court of Justice, on users’ rights in relation to the transparency of the price conditions applicable by airlines. On the airline websites, a hypertext link to this document must be contained in the web page displayed at the time of booking. To implement the provisions, the staff structure of the Competition and Market Authority is increased by eight role units in the managerial career and by two role units in the operational career.