Air New Zealand fined $A15 million over long running cargo cartel case

Image Source: Australian Financial review

Air New Zealand has been fined $A15 million by Australia’s Federal Court over cartel behaviour. The case comes after an investigation by the Australian Competition and Consumer Commission (ACCC). It was alleged that 15 airlines were operating as part a cargo cartel through Asian hubs and into Australia between 2002 and 2007.

The investigation has been running since 2006, with most airlines previously settling. However, Air New Zealand and Garuda Indonesia won their cases in the Federal Court in 2014. The decision was appealed by the ACCC to the Full Court, where the airlines lost. The airlines then lost an appeal to the High Court last year.

The Court found that Air New Zealand made agreements with other airlines to fix the price of fuel and insurance surchages on air freight services between Hong Kong and Australia. The Court also found the airline “gave effect to agreements with other airlines to fix the price of insurance and security charges of flights leaving Singapore and landing at several locations including Australia between 2002 and 2007.”

Air New Zealand was ordered to pay $A11.5 million over the Hong Kong price fixing and an additional $A3.5 million for the Singapore price fixing, in addition to the ACCC’s legal fees of $A2 million.

The Federal Court has reserved it’s decision on the Garuda case. The ACCC has asked the court that Garuda be fined between $A20 million and $A28 million.

Fines for the airline cargo cartel since 2008:

Qantas – $A20 million
British Airways – $A5 million
Air France/KLM – $A6 million
Cargolux – $A5 million
Martinair – $A5 million
Japan Airlines – $A5.5 million
Korean Air Lines – $A5.5 million
Malaysian Airlines – $A6 million
Emirates – $A10 million
Cathay Pacific – $A11.25 million
Singapore Airlines – $A11.75 million
Thai Airways – $A7.5 million
Air New Zealand – $A15 million

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