The minister of aviation and aerospace development, Mr Festus Keyamo, has described as “careless” the resolve by the Federal Competition and Consumer Protection Commission (FCCPC) to question the mechanism adopted by Air Peace to compute its fare on the domestic route.
Recall that the commission had, in a statement, stated that the inquiry into Air Peace’s pricing practices stems from allegations of unjustified fare increases on advance bookings for certain domestic routes, lack of transparency in pricing structures and practices that potentially contravene consumer rights and fair competition principles.
It slammed the airline for asserting that only the Nigerian Civil Aviation Authority (NCAA) is vested with the power to inquire into its (Air Peace) affairs.
Passengers are consumers of its services. Their rights are inalienable and guaranteed under the FCCPA. It is the basis of FCCPC’s intervention.
“As stipulated in Section 17(e) of the FCCPA 2018, the FCCPC is mandated to carry out inquiries considered necessary or desirable in connection with any matter falling within the purview of the Act. Furthermore, Section 127(1) (a) empowers the FCCPC to ensure that pricing practices across all sectors, including aviation, are fair, competitive, and non-exploitative.
“Specifically, it states that no undertaking shall offer to supply or enter into an agreement to supply goods or services at a price or on terms that are manifestly unfair, unreasonable, or unjust.
“Pursuant to Section 148(3) (c) of the FCCPA 2018, the FCCPC, upon receipt of a consumer complaint, can direct an inspector to institute an inquiry and investigate the matter as quickly as practicable to determine whether the undertaking has acted inconsistently with the provisions of the Act.
Reacting to the commission’s declarations, Keyamo said in an interview on Arise News that FCCPC should have contacted the NCAA directly instead of going public.
“The statement by the Federal Competition and Consumer Protection Commission (FCCPC) which questioned Nigerian airline Air Peace’s pricing methodology was careless. I say that with all apology – by the agency, making such a statement without consulting the core agency involved in regulation, which is the NCAA.
“The power to regulate these airlines and for the airlines to inform about their price increase and all of that is domiciled in NCAA, that is the core agency.
“They should have contacted the NCAA for them to look at the books, which we have been doing, so we would have given them facts. But to single out a few airlines that we are struggling to expose to the world for them to get more enhanced capacity, it was a bit careless,” Keyamo said.
The minister emphasised what was at issue was not one of exploitation; rather it was the airline industry’s capacity limitations, especially regarding aircraft acquisition and servicing routes.
“What we are facing is a problem of capacity of the airlines to acquire aircraft and to service their routes.
“Again, we have things that are totally out of our control, which is the issue of the fluctuation of the forex, the exchange rate that affects everything in aviation. Everything in aviation is dollar-based,” he said.
Keyamo further said Nigerian airlines spend majorly foreign currency to wet leasing aircraft.
“All of these are foreign exchange and with the fluctuating nature of our naira against the dollar, you will expect that it will affect also their cost of operation.
“Now, what we are therefore doing is to ensure that we expose them to markets across the world where they can now access aircraft on very good terms, and this will impact on the prices of tickets and their cost of operation. That is what led us to addressing the issue of the practice direction pursuant to the Cape Town Convention. That is the core of the problem of the aviation industry,” he stressed.
The minister disclosed that he will lead a Nigeria delegation to Dublin in January 2025 to meet major airline financiers and discuss how to access aircraft at better rates.
He said such a move will positively impact ticket prices and operational costs.
“All the major airline financiers and liaisons, are all gathered there (in Dublin), and for the first time, they have invited Nigeria because of what we have done, because the effort we have made to make them (Nigerian carriers) access these markets around the world has increased our compliance score from 49% to 75.5% for the first time in history,” Keyamo said.
