the government is preparing a law that blocks the algorithm

the government is preparing a law that blocks the algorithm

The Italian government is preparing to intervene - by law - on the operation of the algorithm of the companies that decides the price of tickets for domestic flights. It is not currently clear how this should happen technically, but the explanations of the carriers on the increase in tariffs have not convinced the Minister of Enterprise and Made in Italy, Adolfo Urso. Hence the intention to act quickly with a "regulatory intervention" - in concert with the Minister of Transport Matteo Salvini - "aimed at countering any unfair commercial practices".

The summit in Rome

The decision comes at the end of the meeting of the Commission for early warning of prices on expensive flights which was held at the ministry together with trade associations. Minister Urso - explains a note - "reiterated the urgency of a trend reversal with respect to the prices of domestic flights, in particular for the routes to and from the islands in a regime of territorial continuity".

Vector replication

Airlines have been replying for days that the kerosene used today was purchased last year when the price – also due to the invasion of Ukraine – shot up in a few days, so the effects of the drop in cost are not yet seen. Not only. Carriers also point out that today demand is much higher than supply and this puts further pressure on fares.

The hypothesis

For Urso, however, these reasons would not be enough. And he also considers the moral suasion that the Italian government has attempted in recent times to be fruitless. For this reason, the ministry believes that the only viable way is that of a legislative intervention in the determination of the price by the companies through the algorithm. It will not be a question of setting a maximum price by law - it is not possible -, but the aim is to tighten the dynamics that lead the price to skyrocket.

The suspect

The suspicion of the technical offices of the Ministry of Enterprise and Made in Italy is that in the presence of a semi-full flight, the airlines activate an "unfair commercial practice" which causes the cost of tickets to skyrocket with an almost auction-like dynamic for those who offer more for the last remaining seats. The legislative provision - the summit between the technical offices of the two ministries is expected - could be valid on all domestic flights, not only to the islands.

Source link