November 9, 2010
The European Commission announced earlier today that the Commission had fined 11 air cargo carriers 799 million Euro in a global air cargo price-fixing cartel that, according to the Commission, affected cargo services within the European Economic Area.
The 11 undertakings fined included Air Canada, Air France-KLM, British Airways, Cathay Pacific, Japan Airlines, Singapore Airlines and Qantas.
In making its announcement, the Commission stated:
“Today the Commission fined 11 air cargo carriers a total of €799.445.000. The cartel members coordinated various elements of price for a period of over six years, from December 1999 to 14 February 2006. The cartel arrangements consisted of numerous contacts between airlines, at both bilateral and multilateral level, covering flights from, to and within the EEA. Airlines providing airfreight services primarily offer the transport of cargo to freight forwarders, who arrange the carriage of these goods including associated services and formalities on behalf of shippers.”
According to the Commission, the contracts on prices between the carriers began with discussions of fuel surcharges (with flat rate surcharges per kilo for air cargo shipments), which was later extended to include an agreed upon security surcharge and concerted refusals to pay a commission on surcharges to freight forwarder clients.
Lufthansa (and its subsidiary Swiss) received full immunity under the Commission’s Leniency Programme, as it brought the cartel to the Commission’s attention. In addition, several of the carriers’ fines were reduced for cooperation with the Commission, including Air Canada, whose fine was reduced 15%.
These most recent fines imposed by the Commission follow earlier fines imposed in Canada. For a copy of the European Commission’s news release see: Antitrust: Commission fines 11 air cargo carriers €799 million in price fixing cartel.
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