Air New Zealand has been ordered to pay $15 million in penalties for its role in an alleged air cargo price-fixing scheme.
The Australian Competition and Consumer Commission said in a statement on Wednesday that Australia’s Federal Court had found Air NZ made agreements with other airlines to fix the price of fuel and insurance surcharges on air freight services from Honk Kong.
They also found the airline engaged with other airlines to fix the price of insurance and security charges on flights from Singapore to various locations, including Australian airports, between 2002 and 2007.
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“These illegal price fixing agreements unfairly reduced competition for the transport cost for goods flown into Australia,” ACCC Commissioner Sarah Court said.
The Court ordered Air NZ to pay a pecuniary penalty of $11.5 million for price fixing in relation to fuel surcharges imposed for cargo from Hong Kong to Australia and an additional $3.5 million for price fixing in relation to the insurance and security surcharge from Singapore to Australia.
According to the consumer watchdog, the airline has also agreed to pay $2 million towards the ACCC’s legal costs.
“This decision sends a strong warning to overseas and domestic operators that the ACCC can and will continue to defend competition and the rights of Australian customers and businesses by taking action against anti-competitive conduct,” Ms Court said.
Since the ACCC first launched its investigation into the air cargo cartel in 2006, penalties totalling $113.5 million have been imposed against 14 airlines including Qantas, British Airways, Air France & KLM, Cargolux, Martinair, Japan Airlines, Korean Air Lines, Malaysian, Emirates, Cathay Pacific, Singapore, and Thai Airways.