EXISTING INTERNATIONAL CIVIL AVIATION ORGANIZATION (ICAO) POLICY 211 “Safeguards against anti-competitive practices 1. The Parties agree that the following airline practices may be regarded as possible unfair competitive practices which may merit closer examination: a) charging fares and rates on routes at levels which are, in the aggregate, insufficient to cover the costs of providing the services to which they relate; b) the addition of excessive capacity or frequency of service; c) the practices in question are sustained rather than temporary; d) the practices in question have a serious negative economic effect on, or cause significant damage to, another airline; e) the practices in question reflect an apparent intent or have the probable effect, of crippling, excluding or driving another airline from the market; and f ) behaviour indicating an abuse of dominant position on the route. 2. If the aeronautical authorities of one Party consider that an operation or operations intended or conducted by the designated airline of the other Party may constitute unfair competitive behaviour in accordance with the indicators listed in paragraph 1, they may request consultation with a view to resolving the problem. Any such request shall be accompanied by notice of the reasons for the request, and the consultation shall begin within 15 days of the request. 3. If the Parties fail to reach a resolution of the problem through consultations, either Party may invoke the dispute resolution mechanism to resolve the dispute”13. Under competition law, we may distinguish four broad categories of anticompetitive behaviours, to which effective competition rules and review procedures should apply as to preserve consumer welfare and ensure fair competition: a) Anticompetitive agreements/arrangements “Hard core cartels” happen when firms agree not to compete with one another, being the most serious violation of competition law. The categories of conduct most often defined as hard core cartels are pricefixing, output restrictions, market allocation and bidrigging (the submission of collusive tenders). Increasingly, the prohibition against hard core cartels is now considered to be an indispensable part of national competition laws14. 13 This model clause has been made part of the ICAO Template Air Services Agreements (TASA), Appendix 1, ICAO Doc 9587 Policy and Guidance Material on the Economic Regulation of International Air Transport. 14 See OECD on “Cartels and anticompetitive agreements”, available in https://www.oecd.org/competition/ cartels/.
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