Riau Airlines Freed of Cartel Charges

PEKANBARU, KOMPAS.com - Riau Airlines had been acquitted of charges of involvement in a cartel fixing fuel surchages in a meeting of the Business Competition Supervisory Commission (KPPU) in Jakarta Tuesday night.

"We accepted the KPPU decision last night, because in fact  Riau Airlines had always been avoiding attempts of doing practices which harmed the consumers or service users," President Director of  Riau Airlines Teguh Triyanto said here Wednesday.
     
Riau Airlines is one of four airline companies namely PT Linus Airways, PT Trigana Air Service, and PT Indonesia Air Asia which turned out not to have committed cartel practices in their business operations, or article 5 of Law no 2 of 1999 banning unfair business monopoly and competition.

Teguh, once Vice President of PT Garuda Indonesia, said he had been thinking of the KPPU verdict till deep in the night, because in its operations Riau Airlines had always followed the principle of transparency, as the company belonged to the people of Sumatra Island.
     
Earlier on Tuesday, the KPPU imposed a total fine of Rp 585 billion on nine local airline companies for involvement in price fixing which had caused additional costs to consumers of up to  Rp13.84 trillion. In its verdict the antimonopoly watchdog said the nine airline companies had violated the antimonopoly law on price fixing.

Teguh said further that on the basis of transparency, the operator of the airline company run under a regional administration company (BUMD) with the Riau provincial administration controlling 51 percent of the shares, which had always been improving its services and perfomance.  He also explained the passengers wishing to know the things that they had to pay with their tickets of Riau Airlines in line with the emergence of a company called low cost carrier.

The passengers deserve to know about the basic rate components of their tickets, value added tax, air passenger insurance, and fuel surcharges set by the respective airline companies. KPPU verdict read out by its commissioner Anna Maria Tri Anggraini in Jakarta Tuesday, sentenced the nine airline companies Garuda Indonesia, Swiwijaya Air, Merpati Nusantara Ailines, Mandala Airlines, Travel Express Aviation Service, Lion Mentari Airlines, Wings Abadi Airlines, Metro Batavia, and Kartika Airlines, to pay a fine and compensation of a total of Rp700 billion after they had been proven to have been involved in a cartel of price fixing from 2006 to 2009.
     
While PT Sriwijaya Air, PT Merpati Nusantara Airlines, PT Mandala Air Lines, PT Travel Express Aviation Service, PT Wings Abadi Airlines, PT Metro Batavia and PT Kartika Airlines, had to pay fines ranging from Rp1 billion to Rp9 billion, and a compensation ranging from Rp1.6 billion to Rp60 billion.
     
The nine airline companies had been proven to have set fuel surcharges under close coordination practicing a cartel in flight zones of 0-1 hour, 1-2 hours, and 2-3 hours excessively causing a loss to the consumers ranging from Rp5 trillion to Rp13.8 trillion. KPPU had also asked the Ministry of Transportation not to authorize associations or unions of businesses to set rates like what had happened on May 4, 2006, by INACA and the nine airline companies.