Nigeria Levies $235 Million Fine On BA and Virgin

The Nigerian government has levied a fine of $235 Million on two British carriers. The affected carriers are British Airways (BA) and Virgin Atlantic, and are fined $135 Million and $100 Million respectively.

The carriers have been accused of sharp practices by Nigeria’s aerospace regulators.

Harold Demuren the Director General of the Nigerian Civil Aviation Authority stated that the airlines were guilty for, “abuse of a dominant position, fixing prices, abusing fuel surcharges and taking advantage of passengers”.

The apex boss of the Aviation Authority further commented that an investigation had been ongoing for several months, and it was found that the Lagos to London route had the highest “yield’ in the world. Many Nigerians have always felt exploited by British Airways and Virgin Atlantic and the DG of the NCAA stated it in clear terms accusing the airlines of “exploitation”.

British Airways has rejected the allegations and it has stated it will vigorously defend its position.

A statement released by the British company said “We pride ourselves on offering competitive fares, a choice of products and connections to our Nigerian customers…We remain committed to Nigeria and have been flying there for more than 75 years.”

This development comes at a time after the Federal Government had already taken orally punitive steps against BA, threatening a reduction in the airline’s weekly allocations to the Lagos airport. The government was acting on the prompting of an indigenous carrier, Arik Airlines. The company launched a formal public complaint to the Nigerian government accusing British Airways of sharp practices.

Last minute negotiations at the highest levels of government led to a temporary resolution and reprieve for BA until the fines were announced today.

According to BusinessNews analysis, at press time a one way ticket from Accra to Ghana booked in advance for November 24^th is $ 1,189 for premium economy, $ 2,049 for a business, and $ 2,300 for First Class. A ticket from Lagos to London is $1867 for Premium Economy and $ 3,685 for Business and, $ 5,408 for First Class.

The tickets from Lagos are 57% higher than Accra for Premium economy, 80% higher for Business Class and 135% higher for First Class.

According to Google Maps, the distance between Lagos and London is 6, 405 kilometers and 322 kilometers shorter than the distance from Accra to London which is 6, 727 kilometers.

Perhaps it is exploitation, or maybe just the laws of supply and demand at work, in any case the fines have been levied.

BusinessNews will continue to monitor the situation.