On October 30, 2009 the Competition Bureau (the “Bureau”) announced that British Airways plc has pleaded guilty in the Federal Court of Canada and been fined Cdn. $4.5 million for participating in an air cargo cartel with effects on Canada. British airways admitted to fixing certain surcharges on the sale and supply of international air cargo exported on certain routes from Canada between April, 2002 and February, 2006.
In its news release, the Bureau stated:
“The fines obtained as a result of our investigation into the air cargo price-fixing conspiracy reflect the serious nature of this behaviour,” said Melanie Aitken, Commissioner of Competition. “The Bureau is committed to uncovering such anti-competitive agreements that harm Canadians, and taking criminal action against the conspirators.”
The latest fine in this case brings the total fines to more than Cdn. $14.6 million (Air France, KLM, Martinair and Qantas all previously pleaded guilty to fixing air cargo surcharges for shipments on certain routes from Canada). This latest case is a reminder that criminal cartels remain an enforcement priority for the Bureau.
Under the federal Competition Act (the “Act”), which governs Canadian competition law, agreements between competitors to fix prices, divide markets, boycott competitors or restrict output can currently result in penalties of fines up to Cdn. $10 million per count and/or imprisonment for up to five years.
As a result of recent sweeping amendments to the Act, however, effective next March, the maximum penalties for offences under the criminal conspiracy provisions of the Act will be significantly increased to Cdn. $25 million per count and/or imprisonment for up to fourteen years.
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