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Author Topic: FlyEurope announces anti-trust litigation against Noordoost Koninklijk  (Read 2015 times)

slickwillbo

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The 2 people who like this post:
FlyEurope today launched an anti-trust lawsuit against former Sky Alliance member Noordoost Koninklijk and various members of the Sky Alliance team.

At the time of writing, Noordoost Koninklijk had multiple Boeing 707-120 aircraft for sale. However, these were not visible to the general public. Further investigation revealed that these frames were for sale exclusively to Sky Alliance members at below alliance minimum pricing. Example recent transactions include:

Boeing 707-120 MSN #124: Bought by Noordoost Koninklijk for $11,329,000 and later sold to Sky Alliance member Royal Arabian Airlines for $2,689,000
Boeing 707-120 MSN #071: Bought by Noordoost Koninklijk for $10,906,000 and later sold to Sky Alliance member Royal Arabian Airlines for $2,680,000
Boeing 707-120 MSN #486: Bought by Noordoost Koninklijk for $9,900,000 and later sold to Sky Alliance member Buddy Holly Airline for $2,753,000
Boeing 707-120 MSN #060: Bought by Noordoost Koninklijk for $10,750,000 and later sold to Sky Alliance member Buddy Holly Airline for $2,678,000

World aviation rules state that “transferring aircraft with the only intention of at the same time generating profits/money to one airline is considered unacceptable." Clearly, Boeing 707-120 aircraft were sold at approximately 25% of market value to other alliance members for the purpose of accruing value to the receiving airlines. Furthermore, by leaving Sky Alliance before the sales took place, FlyEurope alleges that Noordoost Koninklijk has fraudulently distanced itself from its alliance in order to avoid alliance minimum pricing rules while conducting the transactions.

Authorities have been notified and FlyEurope eagerly awaits the outcome of legal proceedings in Amsterdam.

Online groundbum2

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possibly NK is going BK/exit the game so he's getting rid of stuff at firesale prices to old mates..

Simon

Offline Zobelle

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possibly NK is going BK/exit the game so he's getting rid of stuff at firesale prices to old mates..

Simon

AI brokers make enough money without my contribution. That is all.

slickwillbo

  • Former member
Still seems like a way to get around the alliance minimum. Or will you sell me a 707 for $2M too?
« Last Edit: April 12, 2019, 06:22:19 PM by slickwillbo »

Offline Zobelle

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I think you'll do just fine in AMS, sir. :)


Online groundbum2

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NKs also cancelled every route he has soooo.... any cheap DC8s???

;-) S

slickwillbo

  • Former member
possibly NK is going BK/exit the game so he's getting rid of stuff at firesale prices to old mates..

Simon

I know I wouldn’t be cool with it if I were the competitor of one of the beneficiaries. For example, Vintage Airlines shares its HQ with Royal Arabian, who essentially just booked $16M in profits due to this. That’s all of Vintage’s profits for a year.

 Note: I don’t know the CEO of either of those airlines

Offline Zobelle

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I know I wouldn’t be cool with it if I were the competitor of one of the beneficiaries. For example, Vintage Airlines shares its HQ with Royal Arabian, who essentially just booked $16M in profits due to this. That’s all of Vintage’s profits for a year.

 Note: I don’t know the CEO of either of those airlines
Buying cheap metal doesn't inherently make for profits, particularly when that metal languishes with no buyers even at UM market price being very fair.
Not that it's really your business (Given as your airline will benefit my departure from AMS), but I took a gamble on 701's and it didn't pan out. Be happy. :)

Offline SirMS

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For the record, the 707s I purchased will remain under my ownership, so no "$16M profits" have been transferred. But it's nice to see that someone is monitoring all aircraft transactions. :)

Offline Tha_Ape

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For the record, the 707s I purchased will remain under my ownership, so no "$16M profits" have been transferred. But it's nice to see that someone is monitoring all aircraft transactions. :)

Same here.

So a very cheap buying price indeed, but no resell with profits.
I can sometimes complain about the rules, but I do apply them.

The rule is broken when the sole intent is the transfer of funds. But here:
 - you don't know yet what the intent is (or at least not with certainty)
 - the transfer of funds did only "profit" NK, which indeed made some huge losses
 - hint about the future: I probably won't do much money on the 2 birds I bought

I'm a "legalist" guy. Reported cheating once already, wouldn't like to be caught red-handed after all I've said.

Offline DanDan

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Re: FlyEurope announces anti-trust litigation against Noordoost Koninklijk
« Reply #10 on: April 12, 2019, 08:07:02 PM »
FlyEurope today launched an anti-trust lawsuit against former Sky Alliance member Noordoost Koninklijk and various members of the Sky Alliance team.

first thing here, even though an insignificant detail: you are an airline company. you cant launch an anti-trust lawsuit. you can accuse someone of unlawful behaviour. anti-trust lawsuits are not civil law, but criminal law. and therefore they are launched by prosecutors.

At the time of writing, Noordoost Koninklijk had multiple Boeing 707-120 aircraft for sale. However, these were not visible to the general public. Further investigation revealed that these frames were for sale exclusively to Sky Alliance members at below alliance minimum pricing. Example recent transactions include:

out of curiousity:do you have any proof of the statement that these were privately listed? would be interesting to see.

Boeing 707-120 MSN #124: Bought by Noordoost Koninklijk for $11,329,000 and later sold to Sky Alliance member Royal Arabian Airlines for $2,689,000
Boeing 707-120 MSN #071: Bought by Noordoost Koninklijk for $10,906,000 and later sold to Sky Alliance member Royal Arabian Airlines for $2,680,000
Boeing 707-120 MSN #486: Bought by Noordoost Koninklijk for $9,900,000 and later sold to Sky Alliance member Buddy Holly Airline for $2,753,000
Boeing 707-120 MSN #060: Bought by Noordoost Koninklijk for $10,750,000 and later sold to Sky Alliance member Buddy Holly Airline for $2,678,000

World aviation rules state that “transferring aircraft with the only intention of at the same time generating profits/money to one airline is considered unacceptable."

well, what you write seems to be only half the story. would be rather interesting to know why you didnt mention the purchase/sales dates?
because in some of these cases the airplanes were property of the "noordoost" for even more than a year. possibly they were even used, which does contradict that, as the rules state, "the only intention" of it was generating money by transferring.

Clearly, Boeing 707-120 aircraft were sold at approximately 25% of market value to other alliance members for the purpose of accruing value to the receiving airlines. Furthermore, by leaving Sky Alliance before the sales took place, FlyEurope alleges that Noordoost Koninklijk has fraudulently distanced itself from its alliance in order to avoid alliance minimum pricing rules while conducting the transactions.

the market value is not defined by the price of unsold items in the shelves, but the price that items are actually sold for. not sure if you checked the market, but the 707, from my personal experience, is not quite a fast seller. so you may want to rethink that statement.


in my opinion: selling planes at a low/high price is no crime. buying planes at a low/high price isnt either. otherwise there would be no sense in a possibility to change the sales-price of an aircraft.

slickwillbo

  • Former member
Re: FlyEurope announces anti-trust litigation against Noordoost Koninklijk
« Reply #11 on: April 12, 2019, 08:44:29 PM »
Dandan, the participants in the sale are on this thread. Perhaps you can ask them if the aircraft were privately listed, and if so, if they were listed at sub-alliance minimum pricing. However, the facts of the sale don't seem to be in dispute:

1. NK drops out of an alliance
2. NK privately lists aircraft to former alliance members at below alliance minimum.

If this is a valid strategy by the rules, fine. You can ignore this post. But I expect players would feel differently if it were their direct competitor receiving the aircraft, particularly if the number of planes were larger.

Offline Zobelle

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Re: FlyEurope announces anti-trust litigation against Noordoost Koninklijk
« Reply #12 on: April 12, 2019, 09:12:42 PM »
Can't file litigation against a nonexistent entity, Looks like to me like dismissal is in order.. But what do I know? :)

Offline DanDan

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Re: FlyEurope announces anti-trust litigation against Noordoost Koninklijk
« Reply #13 on: April 12, 2019, 09:35:06 PM »
Dandan, the participants in the sale are on this thread. Perhaps you can ask them if the aircraft were privately listed, and if so, if they were listed at sub-alliance minimum pricing. However, the facts of the sale don't seem to be in dispute:

1. NK drops out of an alliance
2. NK privately lists aircraft to former alliance members at below alliance minimum.

If this is a valid strategy by the rules, fine. You can ignore this post. But I expect players would feel differently if it were their direct competitor receiving the aircraft, particularly if the number of planes were larger.

well, since they are on this thread, i assume they can speak for themselves; and i am sure they will explain what they can/cannot to the authorities, if those have reasons to be investigating.

but since it was you who made the accusations, i was asking you

- if you have proof of the statement you made regarding them having been listed privately, since it seems curious to me that you see what is listed privately and what not between other players?

- and foremost, why you did not fully list the information regarding the purchasing and sales dates on the aircraft in question? was it because that information was exonerating?

slickwillbo

  • Former member
Re: FlyEurope announces anti-trust litigation against Noordoost Koninklijk
« Reply #14 on: April 12, 2019, 10:06:36 PM »
 If you read my post, you will see that I saw he had planes for sale, but I could not see them on the used market.  I subsequently found out that all of those planes have been sold to members of his former alliance.

 And I’m not sure when the date of purchase has to do with anything. The question is whether you can avoid alliance minimum pricing by leaving the alliance then selling privately to former alliance members at game world minimum pricing.

Offline DanDan

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Re: FlyEurope announces anti-trust litigation against Noordoost Koninklijk
« Reply #15 on: April 12, 2019, 10:22:44 PM »
And I’m not sure when the date of purchase has to do with anything. The question is whether you can avoid alliance minimum pricing by leaving the alliance then selling privately to former alliance members at game world minimum pricing.

the date is very relevant. if someone buys a plane, uses it for a year and sells it later, then it cant really be considered as not adhering to “transferring aircraft with the only intention of at the same time generating profits/money to one airline is considered unacceptable."

and i am rather sure, as this is your competing airline, and with your evident attention to details, you must have realized, that they were actually using the 707 aircraft, or havent they? adding to that your withholding of the dates of transfers... seems more like someone could be facing a lawsuit for libel? ;)

slickwillbo

  • Former member
Re: FlyEurope announces anti-trust litigation against Noordoost Koninklijk
« Reply #16 on: April 12, 2019, 10:33:33 PM »
Your irrelevant input is duly noted. Thanks for responding.

But you still haven’t answered the question of whether it is acceptable to leave an alliance in order to privately sell aircraft to former members at sub alliance minimum pricing. Perhaps you’d care to answer that question.

Offline DanDan

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Re: FlyEurope announces anti-trust litigation against Noordoost Koninklijk
« Reply #17 on: April 12, 2019, 10:44:21 PM »
Your irrelevant input is duly noted. Thanks for responding.

But you still haven’t answered the question of whether it is acceptable to leave an alliance in order to privately sell aircraft to former members at sub alliance minimum pricing. Perhaps you’d care to answer that question.

well, maybe you need to read more careful, as i did write:

in my opinion: selling planes at a low/high price is no crime. buying planes at a low/high price isnt either. otherwise there would be no sense in a possibility to change the sales-price of an aircraft.

and as far as i know: it isnt forbidden. else it would be really dangerous to buy aircraft on the market. just imagine you buy a plane below alliance price, or above, and then you realize, that that airline was once a member of the alliance... or maybe you already did? do you know the histories of all the airlines that you bought planes from?

but be aware, even though you ask me for clarification of the rules (thanks for thinking so highly of my irrelevant input ;) ) my opinion is not one of an admin...  :laugh:
« Last Edit: April 12, 2019, 10:48:48 PM by dandan »

slickwillbo

  • Former member
Re: FlyEurope announces anti-trust litigation against Noordoost Koninklijk
« Reply #18 on: April 12, 2019, 11:42:05 PM »
and as far as i know: it isnt forbidden. else it would be really dangerous to buy aircraft on the market. just imagine you buy a plane below alliance price, or above, and then you realize, that that airline was once a member of the alliance... or maybe you already did? do you know the histories of all the airlines that you bought planes from?

This is a good point I hadn't considered. Although I think it's a bit more egregious when someone leaves an alliance and sells planes to former members the same day. But it's something to consider.

Offline DanDan

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Re: FlyEurope announces anti-trust litigation against Noordoost Koninklijk
« Reply #19 on: April 12, 2019, 11:53:40 PM »
This is a good point I hadn't considered. Although I think it's a bit more egregious when someone leaves an alliance and sells planes to former members the same day. But it's something to consider.

well, yes, but as said... black letter law is one thing, Samis interpretation a totally different one ;)

 

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