The President of the High Court, Mr Justice Costello, will give his decision today on an application to restrain Ryanair from terminating a travel company's ticket sales agency with the airline.
Dun Laoghaire Travel Ltd yesterday applied for an interlocutory injunction which would continue until the hearing of an action against Ryanair.
The travel agency was last week granted an interim injunction against Ryanair when it was alleged that the airline had decided last March to reduce commission payable to independent travel agents on its ticket sales.
Yesterday, a number of affidavits on behalf of both parties to the dispute were read. In his affidavit, Mr Robert Evans, chief executive of Dun Laoghaire Travel, said he had sold about £1.1 million worth of Ryanair tickets last year. In March, Ryanair had decided to reduce commission payable to independent travel agents on ticket sales from 9 per cent to 7.5 per cent.
Due to the increasingly competitive nature of the travel agency business and to commercial pressures, the agency decided to charge customers a service fee of £5, he said.
Mr Evans alleged that on October 17th last, he had received a fax from the International Air Travel Association (IATA) threatening to de-list his travel agency as a recognised Ryanair agent.
Ryanair was attempting to exploit his outlets to sell its tickets without offering proper commission for such sales, he claimed.
Mr Evans referred to a Ryanair/Sunday Independent promotion where customers could buy a Ryanair ticket for £19 provided they complied with certain terms and conditions.
It was quite clear that Dun Laoghaire Travel could not cover its costs by reduced commission of 7.5 per cent on a fare of £19, he said. Because of this the travel agency had indicated it would charge £5 on all such flights.
In an affidavit, Mr Michael O'Leary, chief executive of Ryanair Holdings, said the litigation had been contrived by Dun Laoghaire Travel to reverse Ryanair's decision to reduce the agency commission rate to 7.5 per cent.
Mr O'Leary said that if Dun Laoghaire Travel was allowed to impose a service fee on Ryanair's fares in addition to the 7.5 per cent then Ryanair had good reason to believe that many other travel agents would start to impose similar charges, which would have a detrimental effect on Ryanair's business.
The imposition of a service fee on low fares would affect Ryanair's reputation and credibility, he said.
In the case of fares such as the current £19 one-way offer, the public might become cynical about the "real price" of such promotions. In reducing its standard rate of commission to 7.5 per cent, Ryanair had merely been following worldwide airline industry trends.