* Airlines to decide prices on shorter routes
* Rule changes to take effect on Nov. 1
* Shares of Air China, China Eastern gain on Friday
(Adds details of reforms, share moves)
By Brenda Goh
BEIJING, Oct 14 China will give some airlines
greater independence to set domestic fares, the Civil Aviation
Administration of China (CAAC) said on Friday, as Beijing moves
to boost airfare pricing reforms amid a broader easing of
controls over aviation.
Local airlines will be allowed to decide ticket prices on
routes that are less than 800 kilometres (497 miles), as well as
on longer routes which compete directly with high-speed rail or
train lines, the CAAC said in a document on its website on
Friday. Prices are currently mostly set by the regulator.
The government has pledged to deepen its reform of the
world's fastest growing civil aviation industry and allow market
forces to play a more decisive role in order to improve service
quality and efficiency.
It relaxed airfare restrictions for the first time in nearly
a decade in 2013, and in January last year begun to allow
airlines including Air China and China
Eastern Airlines to set ticket prices as
high as they wanted to on 101 routes.
The latest rule changes will come into effect on Nov. 1, the
CAAC said, adding that authorities would also continue efforts
to establish a monitoring system for domestic flight fares.
It also said that airlines will need to publicise their
planned adjusted ticket prices a week before they come into
effect, but no more than 10 routes will be allowed to be subject
to price changes in each season.
Air China's mainland-listed shares closed 5.7 percent higher
on Friday, while those of rival China Eastern Airlines finished
3.6 percent up, against a 0.1 percent gain in the blue-chip
(Reporting by Beijing Monitoring Desk and Brenda Goh; Editing
by Clarence Fernandez and Muralikumar Anantharaman)