Timetable Should Not Change At Airlines’ Whim

A consortium of businesses who made a submission on the proposed merger and alliance between Air New Zealand and Qantas is outraged by the Commerce Commission’s decision to delay the timing of the conference on the draft determination and the final decision for 3 months.

Speaking on behalf of the group, spokesman Tim Brown said that the group was disturbed by the apparent influence the airlines had over the Commerce Commission’s decision.

“We are also concerned that those parties who became aware of the request for a delay via the media on Tuesday, and that had subsequently made their opposition to the request known, weren’t even contacted about the decision,” Mr Brown said.

“The Commerce Commission should not change its timetable for the conference on its draft determination simply to suit the airlines’ convenience, or to allow them time to try to bolster their failing case.”

The conference is also to provide other interested parties the opportunity to express their views and to give the Commission itself full opportunity to confirm its factual conclusions that the detriment to the public of New Zealand from the merger would be likely to fall within the range of $202 million to $432 million per annum.

The conference is a critical part of a mandatory statutory procedure and, indeed, must be held in the event that a person with a relevant interest has required it. Before today’s announcement by the Commission a request was also made that the conference be held in a timely fashion, as contemplated by the Commerce Act.

Given other uncertainties currently facing the airline industry – and the travelling public – it is crucial that the Commission’s final decision be known as soon as possible.

“A final “No” now would force both airlines to reconsider their respective options, and perhaps, how a better structured proposal might provide more benefits to New Zealanders at less cost,” Mr Brown said.

The Commission’s announcement delaying the dates for the conference - and effectively extending its final decision for 3 months - only serves to prolong the uncertainty for all those with an interest in air travel and, of course, for the airlines’ employees and owners.

It is the Commission’s conference; but even the Commission does not have a free hand in determining the timing of the conference. The timetable for the conference, in respect of the alliance at least, is fixed by the statute itself and that timetable should have been adhered to.

The Group’s concern was pointed out to the Commission when Air New Zealand’s request was made public on Tuesday, and the Commission has been urged to reconsider the extension. Qantas and Air New Zealand had ample time to properly prepare their applications before approaching the Commission. They do not have to be accorded extraordinary tolerance now by the Commission simply because things have gone so wrong for their case. They should be treated the same as other applicants by the Commission.

The Commission’s final decision will be of the gravest national importance, not just to the applicants. The Commission must ensure therefore that all its processes are open, fair and even-handed – and comply with the statute.

The group continued to favour parallel processes as far as practicable for both the alliance application, and the merger application for which a conference procedure was not so time-bound. However the Group would also be reinforcing its submission that the detriments and alleged public benefits of the two matters should properly have been identified and considered separately by the Commission from the outset, rather than as a single bundled application.

ENDS

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