The Competitions and Markets Authority (CMA) has raised concerns over the proposed acquisition of Farelogix by Sabre, claiming that blocking the merger “may be the only way” of addressing competition issues.
In June 2019, the CMA launched an investigation into the acquisition, which was announced in 2018, to determine whether the merger would limit competition in the airline distribution market and therefore ‘reduce innovation’ in the industry.
The watchdog later slammed Sabre with a £20,000 (US$25,783.91) fine in the second phase of its inquiry for failing to provide certain documentation before a deadline. At the time, the CMA claimed the company had submitted redacted versions of the documents, but later admitted they did not contain sensitive information.
Now the CMA has stated its investigation has raised concerns that the merger “could result in less innovation, higher fees and more limited choice of supplier for airlines” and that “as a result, UK passengers would be worse off.”
The issue at hand is that Farelogix has developed NDCNew Distribution Capability – a new system of technology standards to allow the distribution of airfares and ancillaries through third parties which is being developed by airline association IATA with technology that will provide travel agents with the ability to offer customers more customisable options during the booking process, such as specific meals or ancillary products such as extra leg room or baggage.
Full Content: Gov UK
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