CCP recovers Rs10m from PIA over 2008 Haj fare hike abuse case

KARACHI: Pakistan’s competition watchdog has recovered a Rs10 million penalty from Pakistan International Airlines (PIA), marking the conclusion of a long-standing case involving abuse of market dominance during the 2008 Haj season.

The fine, originally imposed in 2009 by the Competition Commission of Pakistan (CCP), stemmed from findings that the national flag carrier had significantly raised Haj fares -- by over 80 per cent -- without justification. Fares for the southern region surged from Rs38,500 to Rs70,000, while those for the northern region rose from Rs46,200 to Rs85,000.

The CCP determined that this pricing conduct constituted abuse of dominant position under Section 3(3)(a) of the then Competition Ordinance. Despite the gravity of the violation, the commission imposed a token penalty of Rs10 million, citing a lenient approach aimed at promoting compliance and ethical business conduct.

PIA had challenged the penalty in the Supreme Court (SC) of Pakistan, maintaining that it had operated the Haj flights at a loss and was fulfilling its national duty. The apex court, however, referred the matter to the Competition Appellate Tribunal (CAT) for adjudication. After a protracted legal process, the Tribunal dismissed the case due to repeated non-appearance by PIA’s counsel. With the lapse of the statutory appeal period, the CCP invoked its enforcement powers under Section 40(2)(a) of the Competition Act, 2010, and executed recovery of the penalty amount by attaching PIA’s bank accounts.