Qantas Rejects ACCC Action

SYDNEY, 07 May 2002

Qantas Airways today rejected the ACCC's action against the airline under section 46 of the Trade Practices Act.

Qantas Chief Executive Officer Geoff Dixon said the ACCC action related to a legitimate, commercially justified, competitive response by Qantas to Virgin Blue commencing operations on the Brisbane-Adelaide route in early 2001.

"The Commission has been investigating Qantas in relation to this issue since early February 2001 and Qantas has demonstrated clearly to the Commission that its actions did not breach the Trade Practices Act," Mr Dixon said.

"Furthermore, the competitive response by Qantas has clearly been supported by and benefited consumers as it has resulted in more services, greater choice and cheaper fares. "Qantas clearly understands its obligations under the Trade Practices Act, has a comprehensive Trade Practices compliance program and ensures that all its commercial conduct complies with the law.

"After more than a year investigating this matter, why is the Commission commencing this action now? Is it intended to stifle Qantas in its legitimate commercial response to action taken by our competitors?

"As usual, the ACCC has issued a lengthy media release that attempts to justify its action.

"This action demonstrates the Commission's belief that it has a right to force organisations to change their conduct to fit within the Commission's academic perception of appropriate competitive behaviour, regardless of whether the conduct engaged in by the organisation complies with the law as established by Australian courts.

"The Commission's action is likely to have a chilling effect on legitimate competition, not only in the aviation industry but across the economy. This is not an appropriate use of the powers given to the ACCC and will ultimately result in harm to Australian consumers.

"I note that the ACCC concedes at the end of its media release that it will not pursue the majority of its investigations of Qantas behaviour," Mr Dixon said.

"Qantas will vigorously defend this action."

Issued by Qantas Corporate Communication (2695)