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Australia's competition regulator to monitor domestic airfares, profits

Qantas CEO Alan Joyce says the airline wants to get planes back in the sky
Qantas CEO Alan Joyce says the airline wants to get planes back in the sky

Australia's competition regulator will monitor domestic airfares and profits for three years, increasing scrutiny as the industry begins a slow recovery from the coronavirus pandemic and Virgin Australia seeks a buyer. 

The government said today that the Australian Competition and Consumer Commission (ACCC) will monitor prices, costs and profits.

The ACC will also provide another avenue for complaints about anti-competitive conduct. 

"A key matter covered will be the level of capacity the airlines are putting on each route and whether this is occurring in a way that may damage competition," Treasurer Josh Frydenberg said in a statement. 

Qantas Airways holds almost two thirds of the domestic aviation market in Australia.

It said earlier today it would offer 10,000 one-way seats on low-cost arm Jetstar for A$19 to help support a tourism recovery as Australia unwinds coronavirus restrictions and state borders reopen. 

"We have a lot of aircraft on the ground with fixed costs attached to them, so if we can put some of them back in the air by offering special fares, it's a positive for us, for our people, for tourism and for consumers," Qantas chief executive Alan Joyce said in a statement. 

Rival Virgin Australia entered voluntary administration in April, owing nearly A$7 billion to creditors. The airline is expected to emerge a smaller airline under a new owner, in a move that analysts have said could benefit Qantas. 

Binding bids for Virgin Australia from finalists Bain Capital and Cyrus Capital Partners are due on Monday and a final deal would need to be approved at a creditor's meeting in August.

The ACCC will report at least quarterly on its findings, the government said.