ACCC to ensure reborn Virgin not 'killed at birth' by cheap airfares

Australian Consumer and Competition Commissions chairman Rod Sims says he is watching Qantas "extraordinarily closely" to ensure its promised cut-price post-pandemic airfares don't crush Virgin Australia as it tries to relaunch under new owners. Qantas boss Alan Joyce Tuesday said that its budget arm Jetstar might cut Sydney to Melbourne fares to as low as $19 to stimulate demand after COVID-19 travel restrictions lift. The prospect of ultra-cheap airfares comes as potential bidders weigh up rescue packages for Virgin Australia, which went into voluntary administration a fortnight ago. Sims said Qantas appeared to be thinking about low airfares in the context of a new Virgin emerging, which illustrated the benefits for consumers of having two airlines competing with each other. "Secondly, it means we the ACCC need to be watching very carefully as this new player emerges to make sure that its ability to be an effective competitor is not killed at birth," he said. "We just need to make sure there’s no conduct that has the purpose or effect of squashing a competitor." The competition watchdog's relatively new powers in section 46 of the Competition and Consumer Act means it can pursue companies for behaviour which has the purpose, effect or likely effect of substantially lessening competition. <br/>