15 May 2011 | Angeline Albert
New Zealand High Court has handed out its highest ever fine for cartel activity
to Qantas Airways.
The New Zealand Commerce Commission (NZCC)
recommended imposing a fine of NZ$6.5 million (£3.1 million) as part of a
settlement between the two parties in its air cargo cartel case. Qantas has admitted
breaching the Commerce Act by exchanging information with other cargo carriers
to fix the fuel surcharge component of the price for international air cargo
services, including those to and from New Zealand.
Qantas' fine includes a
50 per cent reduction for the airline’s cooperation with the NZCC
investigations. In his High Court judgment Justice Allan said: “As soon as the
nature and scale of the problem came to the notice of Qantas senior management
and its board, the commission was advised that Qantas would co-operate in every
It forms parts of
proceedings brought by the NZCC against a number of international airlines it
alleges colluded to fix the price of air freight cargo. The judge also noted the
airline has committed to making its staff available as witnesses in the cartel
case against the defending airlines.
The airlines continuing
to defend the charges are: Air New Zealand, Cathay Pacific Airways, Emirates,
Japan Airlines International Co, Korean Air Lines Co, Malaysian Airlines System
Berhad, Singapore Airlines Cargo Pte, Singapore Airlines and Thai Airways
International. The first stage of the Court hearing is scheduled to continue
until early June.
British Airways and
Cargolux International Airlines have also agreed settlements with the NZCC,
bringing the total amount of fines dispensed in this case to NZ$14.1 million (£6.8
Investigations into the
cartel in other jurisdictions include Australia, the US, Canada, South Korea
and the European Union
and fines .
NZCC general counsel for
enforcement, Mary-Anne Borrowdale said: “It is appropriate to recognise that
Qantas admitted its price-fixing at the very earliest opportunity, and is
providing genuine assistance with the Commission’s case against the defending