IATA becomes complainant in EC investigation

IATA (International Air Transport Association) has become a formal complainant in an investigation being performed by the EC’s Directorate General for Competition (DG-COMP) in relation to suspected abuse of dominant positions by aircraft equipment manufacturers. Last year, questionnaires were sent out by the DG-COMP to a number of industry stakeholders in which they asked for information required to validate a number of claims of abuse of dominant positions by OEMs (original equipment makers) concerning their control of aftermarket repairs, which included parts and services.
Though a complainant, IATA is not seeking damages in the form of financial restitution or any other form of compensation.
According to IATA’s Director general and CEO, Tony Tyler, “This is an area of deep concern for our members. There are relatively few equipment vendors and our members are frustrated that there is little flexibility in negotiations for aftermarket services. Airlines do not have the leverage to resolve these concerns individually. So IATA is fulfilling its role as their global trade association and representing their interests as a complainant.”
Tyler also confirmed that: “Our focus is on the future. Our members want to be able to negotiate contract terms more effectively and with more options than the OEM community will entertain today. Our aim is to help re-balance the relationship so that airlines and OEMs can work together as true business partners in a normal commercial relationship.”
He underlined that this is an important issue in the airline-OEM relationship, but only a single element of it, “OEM revenues are airline costs, so there is a natural tension on this issue. But airlines are and will continue to be important customers for OEMs. And we all have major common interests in our dedication to the continuous improvement of safety, efficiency and sustainability. Whatever conclusion the investigation comes to, at the end of the process there will be greater clarity on the rules of the game and how they should be applied. That will be a good development for all involved.”