The Federal Ministry of Aviation and Aerospace Development in Nigeria is considering summoning foreign airlines operating on the Lagos-London route for consultations over allegations of anti-competitive practices. These claims have surfaced following the recent pricing strategies adopted by these airlines in response to competition introduced by Nigeria’s private carrier, Air Peace.
If validated, the consultations could extend to the UK Civil Aviation Authority for resolution under international aviation regulations and, if necessary, escalate to the International Civil Aviation Authority (ICAO) for further action.
Air Peace, a Nigerian airline, began direct flights from Lagos to London Gatwick Airport on March 30, 2024, marking a significant step in addressing the imbalance in the Bilateral Air Service Agreement (BASA) between Nigeria and the UK. Air Peace disrupted the market by offering competitive fares, pegging return economy tickets at ₦1.2 million, a significant reduction compared to the previously standard fares as high as ₦3.5 million.
In response, several foreign airlines, including British Airways, Virgin Atlantic, and Qatar Airways, slashed their ticket prices to remain competitive. However, it is alleged that these price reductions were excessive and possibly below operational costs, a strategy seen as an attempt to undermine Air Peace’s operations.
Allen Onyema, Chairman of Air Peace, expressed concerns about the alleged “unspoken alliance” among foreign airlines to drive his company out of the international market. Speaking on a televised program, Onyema alleged that these airlines were engaging in predatory pricing to force Air Peace out of the Lagos-London route, which could have long-term detrimental effects on Nigeria’s aviation sector.
“Taking out Air Peace prematurely will cost this country dearly,” Onyema warned, adding that it would place additional strain on the naira and significantly impact the economy. He further accused foreign airlines of receiving government-backed support to engage in practices detrimental to Nigerian carriers.
The issue of anti-competitive practices is addressed within ICAO guidelines, which emphasize fair competition and consumer welfare in international air transport. According to ICAO, behaviors such as charging fares below operational costs, overloading capacity, or abusing market dominance are potential indicators of unfair competition. These guidelines provide a framework for resolving disputes between countries and their airlines.
Sources indicate that the Federal Ministry of Aviation, under the leadership of Festus Keyamo (SAN), is actively investigating these claims. If deemed necessary, the ministry will convene consultations with the implicated airlines to ensure compliance with global aviation standards.
This development highlights the challenges faced by emerging market airlines as they attempt to compete on global routes dominated by larger carriers. The outcome of the investigation could set a precedent for how such disputes are handled and underscore Nigeria’s commitment to protecting its aviation industry from unfair practices.
