Ryanair has found itself in a war of words with Italy’s competition authority over allegations that the low-cost carrier has been abusing its dominant position in the country by restricting access to both physical and online Travel Agencies to its offers and discounts.
The Competition Authority (AGCM) has reportedly gone so far as to allege that Ryanair has caused “serious and irreparable” damages to Travel agencies, as well as other airlines and passengers, according to a report in Italy’s Il Messaggero newspaper.
Ryanair is the largest airline in Italy, and it is hoping to grow its market share even further should Lufthansa succeed in acquiring Italy’s state-owned ITA Airways – an act that might require Lufthansa to hand back some takeoff and landing slots to allay European antitrust fears.
The AGCM has opened a probe into the allegations, but Ryanair has long contested that it is protecting consumers from unscrupulous online travel agencies that ‘illegally’ scrape its website for fares and then overcharge customers for add-ons like baggage and priority boarding.
Last week, Ryanair slammed the AGCM for allegedly failing to take action against online travel agencies and demanded Chairman Roberto Rustichelli publicly explain why the agency is allowing websites like eDreams to “overcharge Italian consumers”.
Ryanair has claimed that eDreams was overcharging consumers €25.24 for an €8 reserved seat and doubling the price of a 10kg bag allowance from €19.79 to €39.42.
Several online travel agencies attempted to sue Ryanair in an Italian court for restricting access to its fares, arguing that the carrier was abusing its dominant position, but the Milan Court of Appeal dismissed the case, ruling that Ryanair’s direct sales policy was “reasonable” and had resulted in lower fares for Italian consumers.
In recent months, however, Ryanair has eased its direct sales policy, signing agreements with several online travel agencies that now have access to Ryanair’s full range of fares. The agreements stipulate that these online travel agencies cannot overcharge customers or invent ‘fake’ service fees.
Several online travel agents, including eDreams, Opodo and Gotogate, have yet to reach a deal with Ryanair.
If the AGCM does, however, conclude that Ryanair is abusing its position in the Italian market, the airline might be required to open up its fares to the likes of eDreams, whether it likes it or not.
Ryanair chief executive Michael O’Leary slammed the regulatory probe on Monday, saying: “The AGCM complaint shows that they allowed themselves to be misled by false claims from OTA Pirates, such as eDreams, particularly when these claims contradict the pro-consumer Jan 2024 Milan Court of Appeal ruling.”
“When will the AGCM finally take action to protect Italian consumers from eDreams’ hidden mark-ups and internet piracy and follow the conclusive pro-consumer ruling of the Milan Court of Appeal?”
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