Air New Zealand Faces $10 Million Fine For Cargo Price-Fixing

May 7, 2013
Air New Zealand could face a fine of up to $10 million if allegations that it conspired with other airlines to fix cargo prices are proved.

Air New Zealand could face a fine of up to $10 million if allegations that it conspired with other airlines to fix cargo prices are proved.

The Commerce Commission took a case against the national carrier and 12 other airlines in December 2008, alleging they colluded to impose fuel and security surcharges for air cargo shipments to and from New Zealand.

A scheduled penalty hearing in the High Court in Auckland yesterday was declared confidential by Justice Allan, but was then adjourned until Friday.

Air New Zealand has listed the Commerce Commission proceeding as a "contingent liability" in its accounts but has not quantified the amount of its potential liability.

The Commerce Act says any penalty "must not exceed the greater of" a $10m fine, the value of three times the commercial gain resulting from a breach, or 10 per cent of the company's turnover.

Last month the High Court ordered three airlines - Cathay Pacific, Thai Airways and MASkargo - to pay a combined $9.6m in penalties for their role in the cartel case.

In 2011 British Airways was fined $1.6m and Cargolux International was fined $6m.

Qantas was penalised $6m, Cathay Pacific paid $4.3m and Singapore Cargo Airlines was fined $4.1m. Emirates, Korean Air, Japan Airlines and Thai Airways were also fined millions of dollars each.

Total penalties reached more than $35m, with Air New Zealand the only airline yet to settle. Fairfax NZ

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