CCP Recovers Rs10 Million Penalty from PIA for Hajj Fare Hike Abuse

ISLAMABAD: The Competition Commission of Pakistan (CCP) has successfully recovered a Rs10 million CCP penalty on PIA, originally imposed in 2009 for abusing its market dominance by excessively raising Hajj fares in 2008.

The penalty stemmed from a CCP investigation triggered by media reports alleging that Pakistan International Airlines (PIA) had significantly overcharged Hajj pilgrims. The inquiry revealed that the national airline had hiked Hajj fares by over 80%, increasing rates from Rs38,500 to Rs70,000 for the southern region and from Rs46,200 to Rs85,000 for the northern region.

This conduct was deemed a violation of Section 3(3)(a) of the then-prevailing Competition Ordinance. Taking a lenient stance to promote compliance and ethical practices, the CCP imposed a token CCP penalty on PIA amounting to PKR 10 million.

PIA challenged the decision in the Supreme Court of Pakistan, arguing that it had operated Hajj flights at a loss while fulfilling its duties as a national carrier. However, the Supreme Court referred the matter to the Competition Appellate Tribunal (CAT) for proper adjudication.

After several hearings, the Tribunal dismissed the case due to non-appearance by PIA’s legal counsel. Once the appeal period had expired, the CCP invoked its authority under Section 40(2)(a) of the Competition Act, 2010, and enforced the recovery by attaching the airline’s bank accounts.