Qantas, BA settle New Zealand cartel case | world | Hindustan Times
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Qantas, BA settle New Zealand cartel case

world Updated: Mar 18, 2011 12:40 IST

New Zealand's competition watchdog said on Friday that British Airways and Qantas had admitted price fixing, with the Australian airline saying it would pay a NZ$6.5 million ($4.7 million) fine.

The New Zealand Commerce Commission (NZCC) said BA and Qantas, along with Luxembourg-based Cargolux International, had agreed to settle a long-running case relating to manipulation of fuel surcharges in the global cargo market.

The settlement -- the latest of its kind around the world -- involved the three airlines admitting liability and paying "significant" penalties, the NZCC said.

It added that further details could not be released until the deal had been approved by the courts.

"Settling with parties who are prepared to acknowledge wrongdoing is consistent with the commission's enforcement strategy," the regulator said.

It added proceedings against United Airlines had been dropped but it would press on with the case against another 10 carriers, including Air New Zealand, Japan Airlines, Cathay Pacific, Malaysian Air Lines, Garuda and Thai Airways.

The commission's action alleges airlines colluded on fuel surcharges on international cargo flights between 2000 and 2006.

Qantas said it had agreed to plead guilty in a New Zealand court next month and pay the NZ$6.5 million fine, adding in a statement that it will "continue to cooperate fully with the commission in its prosecution of other airlines".

Qantas said it had already reached settlements with regulators in the United States, Australia, Canada, Korea and Europe over the conduct of its freight division.

Similar prosecutions have led to huge fines across the globe, with the European Commission in November fining 11 airlines a total of 800 million euros ($1.10 billion) after 19 carriers were forced to pay $1.6 billion in the United States.

Air New Zealand, which denies the NZCC allegations, said none of the international investigations had found it acted illegally.

It said the fact that the NZCC was bringing a case against it should not give the impression it was guilty.

"That is simply not true and the commission knows it," Air New Zealand general counsel John Blair said in a statement.

The New Zealand case against the 10 airlines that are contesting the price-fixing allegations is due to be heard in mid-2012.