ICCC Approves Code-sharing For Airlines

On 9^th of April, 2021, Link PNG lodged an application for authorization in accordance with Section 70 of the ICCC Act 2002, to enter into and give effect to a proposed JOA which includes provision of a proposed Code-share Agreement with PNG Air for the duration of five years.

According to the application, the proposed JOA is for the purpose of, among other things, the coordination of flight schedules, fleet allocation, operational and maintenance of services and charter airline operations between the two airlines. The proposed Code-share Agreement was for a free-sale basis.

ICCC Commissioner and Chief Executive Officer, Paulus Ain said the ICCC identified the relevant markets as:

• The market for the provision of domestic scheduled or regular passenger transport services;
• The market for the provision of domestic air freight services; and
• The market for the provision of domestic air charter services, to destinations within PNG.

“Overall, the ICCC has considered that only the proposed Code-share Agreement should be authorized with a number of conditions aimed at minimising the likely anti-competitive effects and ensuring the two airlines continue to compete in the long term,” Mr Ain said.

He said the ICCC has considered that the proposed JOA should not form part of the authorization, because it would and be likely to lessen competition and result in greater detriment than benefit to the public.

“The ICCC therefore grants authorization with conditions to Link PNG to enter into and give effect only to the proposed Code-share Agreement, which includes both passenger and freight, with PNG Air for two years from the date the authorization becomes effective.

“For the avoidance of doubt, no other provisions of the JOA are authorized by this Determination, but only the Code-share Agreement is authorized.”