Three airlines settle out of court in New Zealand cartel case

Mar 18, 2011, 0:15 GMT

Wellington - Three international airlines have admitted operating an illegal cartel to fix freight rates in New Zealand, the anti-competition watchdog Commerce Commission announced Friday.

The airlines - British Airways plc, Cargolux International Airlines S.A. and Qantas Airways Ltd of Australia - have paid significant penalties, the commission said in a statement.

Details would not be released until they are signed off by the High Court.

The commission said court proceedings would start in May against 10 other airlines who deny colluding to raise freight prices by imposing fuel surcharges on shipments into and out of New Zealand for seven years.

They were named as Air New Zealand Limited, Cathay Pacific Airways Limited, Emirates, Japan Airlines International Co Limited, Korean Air Lines Co Limited, Malaysian Airlines System Berhad Limited, PT Garuda Indonesia, Singapore Airlines Cargo Pte Limited and Singapore Airlines Limited and Thai Airways International Public Company Limited.

The statement said the commission had discontinued the case against United Airlines Incorporated.

'We continue to focus our case and direct our efforts towards those airlines with large turnover in New Zealand markets,' general counsel of enforcement Mary-Anne Borrowdale said.

She said that airlines had been convicted of illegal price-fixing in Europe, the United States, Australia, Canada and South Korea.

The first stage of the case in New Zealand would test whether the commission could pursue price-fixing conduct that occurred overseas.

'We need to know whether deliberate collusion overseas, to affect New Zealand markets, is something that we can take enforcement action against,' she said.

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