European Commission fines leading air cargo carriers €776M for price fixing
The European Commission (EC) has re-adopted a cartel decision against leading air cargo carriers and imposed a fine of €776.47 million (US$834.98 million).
In 2010, the EC determined fines for the companies' involvement in a price-fixing cartel from December 1999 to February, 2006 covering flights from, to and within the European Economic Area.
The cartel arrangements consisted of numerous contacts between airlines, at both bilateral and multilateral levels to fix the level of fuel and security surcharges.
Carriers involved in the scandal included Air Canada, Air France, KLM, Martinair, British Airways, Cargolux, Cathay Pacific Airways, Japan Airlines, LAN Chile (now LATAM), SAS, Singapore Airlines, Lufthansa, Swiss International Air Lines and Qantas.
All companies except Qantas appealed to the EU's General Court against the EC's 2010 decision, which ended up being annulled on procedural grounds in 2015; as a result the decision became final for Qantas.
However, the General Court did not rule on the existence of the cartel, and the EC has now decided to bring operative aspects of the case in line with the reasoning part, thus re-activating the fines with some reductions under a leniency notice.
Lufthansa and its subsidiary Swiss International Air Lines have received full immunity from the fines, but the others have been charged varying amounts with the largest sums demanded of Air France, KLM, British Airways and Cargolux.
Full details can be found here.
"Millions of businesses depend on air cargo services, which carry more than 20% of all EU imports and nearly 30% of EU exports," said Commissioner Margrethe Vestager, who is in charge of competition policy.
"Working together in a cartel rather than competing to offer better services to customers does not fly with the Commission.
"Today's decision ensures that companies that were part of the air cargo cartel are sanctioned for their behaviour."