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Qantas Involved In Global Conspiracy

Posted in Airline News, QantasNo comments

New Zealand’s competition watchdog has accused a host of airlines, including Qantas, of a global conspiracy to raise the price of freighting cargo.

The Commerce Commission in New Zealand on Monday said it had begun High Court proceedings against 13 airlines and seven staff, including senior executives.

Up to 60 airlines globally and many individuals were potentially involved in the alleged price fixing.

The Commission’s action focused on those airlines that had the greatest impact on New Zealand, and allegedly the most culpable people.

In a statement the Commission alleged the airlines first entered into an illegal global agreement in 1999/2000.

“The airlines imposed the fuel surcharges between 2000 and 2006. The allegations also involve a series of regional price fixing agreements,” the statement said.

“In addition, the Commission alleges that a number of airlines conspired to price fix through the imposition of a security surcharge immediately following the 9/11 terrorist attacks,” it said.

It said all the people named in the proceedings were managers who were allegedly involved in promoting the conspiracy or deliberately refrained from stopping the conduct.

Commerce Commission chair Paula Rebstock said the alleged collusion had caused extensive harm to the New Zealand economy.

“New Zealand is a long way from its overseas markets and so the harm to our economy and our ability to compete internationally will have been disproportionately greater than in other jurisdictions,” Rebstock said.

“Many New Zealand businesses and every consumer will have been directly affected by the increased air freight costs over many years.”

Airlines earn an estimated $NZ400 million-plus ($A330 million) annually transporting air cargo to and from New Zealand, and during the seven years this agreement allegedly occurred, total revenue was about $NZ2.9 billion ($A2.4 billion), the Commission said.

The New Zealand action comes after the Australian Competition and Consumer Commission took action in October against Qantas and British Airways for alleged price fixing in the air freight market.

The federal court in Sydney last week fined Qantas $A20 million and British Airways $A5 million.

Some of the airlines named in the New Zealand proceedings were cooperating with the current investigation and an early resolution may be possible, the Commission said.

The airlines named by New Zealand authorities are: Qantas Airways, Air New Zealand, British Airways, Cargolux International Airlines S.A, Cathay Pacific Airways, Emirates, PT Garuda Indonesia, Japan Airlines International, Korean Airlines, Malaysian Airline System Berhad Limited, Singapore Airlines Cargo Pte Limited and Singapore Airlines Limited, Thai Airways and United Airlines.

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