Budget Airlines Raided in Price-Fixing Probe

The offices of four German airlines have been searched by the competition authorities on suspicion of possible price fixing, the airlines said on Tuesday. LTU, Condor, Hapagfly and Air Berlin all confirmed their offices had been searched. The Federal Cartel Office, Germany's competition watchdog, said it was investigating the simultaneous cancellation by all four airlines of their commission contracts with travel agents. The office suspected the airlines planned to reduce or cancel altogether the commission that travel agents took on sales of their carriers' tickets. The airlines dismissed the allegations and said they had nothing to fear from the probe.

The current commission system has been called into question after German carrier Lufthansa announced last September it would cancel commission on tickets sold by travel agencies. Air Berlin, has said it would follow Lufthansa's example and sell tickets to agents without any commission, leaving it up to the agents whether to mark up the tickets for the customer and pocket the difference.