614 COMPETITION LAW IN TOURISM need of having an aggregator with sufficient financial and technological resources has also preserved the status of the legacy GDS (and putting on a different hat as an aggregator) and allowed the emergence of new aggregators. It changes how aggregators price airlines and agents, and also how airlines make offers which will ultimately affect the profitability of agents. Geographical markets also play a key role in the extent to which NDC will be implemented. NDC, it is submitted, is not in itself anti-competitive, but it remains to be seen if it will actually create a restrictive effect on competition through its implementation. For completeness, although GDS Surcharge is beyond the scope of this article, in the case that it is found to be an abuse of dominance infringing Article 102TFEU, it is worth raising the query if there is any valid objective justification33 for the surcharge. Some airlines attempt to justify it on the basis of recovering the cost of distribution via GDS, yet airlines have been enjoying substantial discounts for years under their full content agreement with GDS companies, which should already have accounted for the distribution cost through negotiation. Unless airlines are now restricting contents distributed through GDS and there is a corresponding increase in cost of distribution under the relevant terms of full content agreement, it seems too much of a coincidence that GDS surcharge is levied at the same time as the introduction of the NDC channel34 for any purpose other than to exclude GDS. 33 Guidance on Commission’s enforcement priorities in applying Article 102 of the TFEU to abusive exclusionary conduct by dominant undertakings, 24.2.2009, OJ C45/7, para 89. On the other hand, it is submitted that NDC incentives would be compatible with Article 102 TFEU. 34 Another less apparent problem is charging of a flat rate. It does not reflect the incremental distribution cost via GDS when, as NDC develops through time, bookings made through NDC rises and through GDS drops. BA/ Iberia seems to have avoided such an issue by raising the surcharge twice.
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