The pandemic, the Italian regulation of air transport and methods of price setting through the use of algorithms

Recently, in air transport, strong tensions were reported, with significant increases in transport prices and marked fluctuations. There is a widespread belief that these depended on the systematic use of highly sophisticated mathematical tools (algorithms) for calculating air transport charges. The Italian legislator declared his conviction that he had to correct imbalances originated by the epidemic situation and increased by the use of algorithms. The Law No. 136 of 2023, which converted the Decree-Law No. 104 of 2023, refers all initiatives to the Italian Competition and Market Authority, which must ascertain that the algorithmic coordination of fares practised by airline companies implements an agreement restrictive of competition, even if pre-existing, or ascertains that the level of prices set through a revenue management system constitutes an abuse of a dominant position. Thus, the interventions on the use of algorithms are linked to the overall assessment of the market structure. In this context, the automated analysis of the “type of electronic devices used for bookings” takes on importance in a broader examination of the operators’ behavior