30-day ultimatum to BA, Virgin Atlantic, others not negotiable – FG

The federal Government, yesterday, reiterated its warning to British Airways, Virgin Atlantic Airways and other foreign airlines operating in the country to take advantage of the 30-day ultimatum given them to dismantle their fare disparity or face the repercussion.

Government’s reaction came against the backdrop of last weekend’s declaration by British Deputy High Commissioner to the country, Mr. Giles Lever, that Nigeria had no legal rights to ban the British carriers over fare disparity.

Lever had in an online interview with a national daily  contended that a ban on either British Airways or Virgin Atlantic would amount to a breach of the Bilateral Air Services Agreement, BASA, between both countries.

Reacting through her Special Adviser, Media, Mr. Joe Obi, Aviation Minister, Princess Stella Oduah, said the issue at stake had nothing to do with legality or illegality, stressing that what was on the table was the need for all foreign airlines to restructure their fares to reflect the BASA their countries had with Nigeria.

She said the British government would know whether Nigeria had the powers to sanction British Airways and Virgin Atlantic Airways on the expiration of the 30-day ultimatum on April 25, 2012.

The minister said: “We don’t want to join issues with the British government; we are dealing with the airlines and have given a 30- day deadline. It will be in their own interest to either come for negotiation before the expiration of the ultimatum or face the repercussion.

“At the end of the deadline, if they remain adamant, they will know whether or not we have powers to do what we are doing. There is nothing in the Bilateral Services Agreement that says Nigerians should pay more than passengers from other countries in West Africa.”

The genesis

The disagreement over fare disparity between the Federal Government and Britain triggered off in the last quarter of last year, following the denial of slot allocations to Arik Air on its Abuja-London operation at Heathrow Airport in London.

Consequently, government threatened to ban British Airways operations into the Murtala Muhammed International Airport, Lagos, as a retaliatory measure and also called for immediate dismantling of unfair fare structure to bring to par fares charged in Nigeria to those in other West African countries, especially Ghana where fares are relatively lower, and this prompted the intervention of the British government which called for a negotiation.

At the negotiation, representatives of the British government begged for an extension of time to enable them conduct an independent study of the fare regime in Nigeria, compared to the fare structure in other countries of the region and promised to get back to the federal government on December 31, 2011.

The 30-day ultimatum

However, government got no word from its British counterpart, prompting the Minister of Aviation to issue the 30-day ultimatum to all foreign airlines, especially BA and Virgin Atlantic Airways, to dismantle their current fare structure in Nigeria to reflect equity with other countries in the region or face a ban.

Issuing the ultimatum March 25, 2012, Aviation Minister, Princess Oduah, lamented that the British government had adopted delayed tactics to wear out the issue at stake, to the extent that the British carriers would carry on business as usual, based on the offending fare structure.

Stakeholders declare support

So far, some professional bodies in the country and stakeholders in the aviation sector have declared their avowed support for government over its determination to enthrone a fare structure for air travellers in Nigeria by the foreign airlines.

Only last week, the Nigerian Bar Association, NBA, offered free legal services to government in cases of litigation or review of treaties and bilateral agreements signed with other countries.

NBA President, Mr. Joseph Daudu, SAN, when he led a delegation recently to the minister in her office in Abuja, condemned the disparity in the fares charged passengers travelling from Nigeria to the UK and those travelling from Accra, Ghana.

He commended the effort of the minister to stop the unfair treatment of Nigerians by foreign airlines.

The NBA boss insisted that any investor who did not treat Nigerians with respect and dignity would be shown the way out.

The two arms of the National Assembly have also voiced their opposition to the unfair fare structure of the foreign airlines, vowing to ensure that the British carriers, particularly, were sanctioned should they fail to review their fares.

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Air fare hikes: Nigeria has no legal basis to ban foreign airlines —British govt

The British Government yesterday declared that the Nigerian government has no legal basis to ban foreign airlines operting in the country over controversial airfare disparity. In an exclusive online interaction with The Nation yesterday in Abuja, the British Deputy High Commissioner to Nigeria, Mr. Giles Lever said that a ban on either the British Airline (BA) or Virgin would be a breach of the Bilateral Air Services Agreement (BASA). 

The interview went thus: Is it true that fare disparity is a deliberate action by the British government to exploit Nigerians? The British Government has no role in setting the fares of privatelyowned airlines such as BA and Virgin flying to Nigeria. The bilateralAir Services Agreement (BASA) states that “tariffs should be set freely and independently by the designated airlines on an economic basis”. 

There is no disparity in economy class, where most ordinary Nigerians fly. Indeed, economy class prices from Nigeria on British airlines are often lower than from elsewhere in the region. 

Is the British government exploiting other means of resolving the crisis especially when the Nigerian Senate has stepped into the matter? The UK and Nigeria have a strong relationship based on shared friendship, history, values, mutual respect and honesty. 

Our President and Prime Minister have committed to an ambitious agenda of bilateral cooperation covering trade and investment, development, security, people-to-people and much else besides. We want to continue to discuss this issue of air services with the Nigerian government in the spirit of this partnership. 

Can BA justify the fare disparity? There is no fare disparity in economy class, where most ordinary Nigerians fly. Indeed economy class prices from Nigeria on British airlines are often lower than from elsewhere in the region. What is the British government reaction to the threats by the Nigerian Senate, the Nigerian Bar Association and the government to take decisive action against BA if it does not change the policy? The UK-Nigeria partnership is hugely important to us- we want to see stronger air links between our two countries with more competition and choice, not less

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Reps threaten British Airways over high fares

The House of Representatives Committee on Aviation on Monday threatened to sanction British Airways if it failed to reduce its air fares for Nigerian passengers.

Nkiruka Onyejeocha (PDP-Abia), the chairman of the committee, gave the warning at an investigative hearing on the arbitrary hike in air fares by international airlines operating in the country.

It would be recalled that on February 22, the House at plenary session mandated the Committee on Aviation to investigate high fares charged by international airlines.

Onyejeocha noted that in spite of the free market economy of the country, airfares in Nigeria were the highest within the West African sub-region.

“This arbitrary airfare charges are exploitative, particularly as the country’s aviation fuel is one of the cheapest in the market,” she said.

According to her, Nigerians pay higher to travel to places like Europe and America, while other African countries attract cheaper fares at same distances.

“This exploitation must not be allowed to continue, more importantly as Nigeria is one of the most lucrative routes in the world with minimum daily passengers of 1,000,’’she said.

“The bottom line is that you must reduce your fares or you quit,” she said.

“This unethical behaviour of airlines cannot continue unchecked, we need the fare to be reviewed,” she said.

She appealed to all airline operators to cooperate with the committee to ensure a downward review of fares charged.

The legislator assured the operators of the committee’s readiness to collaborate with them and other stakeholders to address the challenges facing the operators.

Onyejeocha blamed the Nigerian Civil Aviation Authority (NCAA) for not doing enough to check activities of the airlines.

Kola Adeyinka, Country General Manager of the British Airways, told the committee that the European Anti-Trust legislation prohibited him from discussing price structure in the presence of other airline operators.

He said that fixing air fares was influenced by demand and supply and competitive environment.

Adeyinka said that the United Kingdom Department of Transport and its Nigerian counterpart were discussing on the matter and would come out with resolution in June.

He noted that air fare pricing in Nigeria was different from what was obtainable in Ghana.

Adeyinka said that the airline was ready to work with the committee to satisfy its customers.

“We are willing to work with the House, we will not do anything to jeopardise the interest of our customers,” he said.

He assured the committee that the fare would be reviewed and a brief would be sent to the House.

Harold Demuren, Director-General of NCAA, said that British Airways and Virgin Atlantic Airways had been under similar investigations in other countries over imbalance in airfare.

He said that after a thorough investigation in November 14, 2011 by NCAA, it was discovered that both airlines colluded to fix the passenger fuel surcharge which affected Nigerian customers.

Demuren said that the disparities between airfares from Nigeria and similar distances, particularly, Ghana remained unanswered.

He said that the NCAA would work assiduously to prevent the exploitation of Nigerians by imposing stiff penalties.

Aminu Agoa, National President of National Association of Nigerian Travel Agencies in his presentation said that the air fare price structure displayed on Internet was not saleable to Nigerians.

Agoa said that members of the association only made marginal interest as airline operators did not pay commission.

He blamed the British Airways, which, he noted, started the differential in airfare while other airlines followed.

Other stakeholders at the hearing include Lufthansa Airline, Air France, Qatar Air, KLM, South African Airways, among others.

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