In the last six months, further heavy fines have been meted out by competition regulators in New Zealand, Australia and Canada in ongoing price fixing investigations.
In June, Japan Airlines, having emerged from bankruptcy in 2011, reached a settlement with the New Zealand Commerce Commission (NZCC) under which it agreed to pay fines of NZ$2.3 million for the part it played in an air cargo price fixing cartel.
Japan Airlines got a 35% discount on its fines in recognition of the admissions it made and its ongoing co-operation with the NZCC’s investigation. It is the fourth airline to settle with the NZCC, which filed proceedings against 13 carriers in December 2008 alleging collusion on fuel and security surcharges for air cargo shipments into and out of New Zealand. The cases against the remaining carriers will continue in the High Court in Auckland in March 2013.
Malaysia Airlines settled with the Australian Competition and Consumer Commission (ACCC) in June (having first pleaded unsuccessfully that it was entitled to sovereign immunity under the Australian Foreign State Immunities Act, on the basis of its government ownership control), following prosecution for the part it played in price fixing with competitors on fuel and security charges and customs fees applicable to freight carried from Indonesia to Australia and other countries between 2001 and 2005. Under the terms of the settlement, Malaysia Airlines agreed to pay A$6 million in penalties.
Garuda Indonesia also tried to avoid fines in the same investigation brought by the ACCC, by invoking the defence of state immunity under the Australian Foreign State Immunities Act, but it has also fallen foul of the exception under that Act that foreign states will not be immune from proceedings based on commercial transactions, so now faces potentially heavy fines.
Korean Air pleaded guilty in July to conspiracy under the Canadian Competition Act, following an investigation into air cargo price fixing with competitors on certain routes from Canada between 2002 and 2006, and has been fined Canadian $5.5 million. Cargolux, Air France KLM, Martinair, Qantas and British Airways have already pleaded guilty for the part they played in the cartel and have been fined.
In October, Emirates agreed to pay a fine of A$10 million to settle the case brought against it by the Australian Competition and Consumer Commission (ACCC) for price fixing on fuel and security charges, conceding that it reached illegal understandings with other airlines relating to surcharges and a customs fee on air freight from Indonesia to Australia and elsewhere. Emirates was also fined A$3 million for attempting to fix rates with DAS Cargo for the supply of air freight from Australia.