Two air cargo providers escape domestic anti-cartel action


Air New Zealand and Garuda contest charges and win in Federal Court

Two air cargo providers escape domestic anti-cartel action
Air cargo cartel prosecutions have seen huge fines levied

 

The Australian Competition and Consumer Commission (ACCC) has had a rare set-back in its pursuit of airlines targeted in one of the biggest global anti-cartel actions yet seen.

Two airlines, Air New Zealand and Garuda, have seen their charges dismissed in the Federal Court.

"The proceedings against Air New Zealand and Garuda concerned alleged arrangements or understandings with other international air cargo carriers in the period between 2001 and 2006, to fix fuel, security and insurance surcharges on air cargo services," the ACCC states.

"Whilst Justice Perram concluded that a number of collusive arrangements were made out, he found that the conduct did not take place in a ‘market in Australia’ as required by the Trade Practices Act 1974 (now the Competition and Consumer Act 2010) at that time."

Airlines that pleaded guilty to price fixing in the Australian air cargo market and were fined between $3 million and $20 million are: Qantas, British Airways, Singapore Airlines, Air France, KLM, Cargolux, Cathay Pacific, Emirates, Thai Airways, Korean Air Lines, Malaysian Airline, Japan Airlines and Martinair.

The $20 million fine was on Qantas, but that pales against the $61 million it paid in the US and even that is minor compared with fines there of $350 million on Air France and $300 million each on BA and KAL.

All the airlines fined also paid out on class actions in other countries similar to the one law firm Maurice Blackman conducted in Australia, its website shows.

"This is a long and complex judgment which the ACCC will carefully consider," ACCC chairman Rod Sims says.

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