Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


Singapore Airlines Cargo settle air cargo cartel case

Singapore Airlines Cargo becomes seventh airline to settle air cargo cartel case


The High Court has ordered Singapore Airlines Cargo PTE (SIA Cargo) to pay a $4.1 million penalty for price fixing in breach of the Commerce Act. The company is the seventh airline to settle with the Commerce Commission in the long-running air cargo cartel case.

Today's penalty judgment brings the total penalties ordered in the case to $25.475 million. The Commission previously reached settlements with British Airways PLC, Cargolux Airlines International S.A, Emirates, Korean Air Lines Co., Limited, Qantas Airways Limited and Japan Airlines International Co., Limited.

SIA Cargo admitted liability for agreeing fuel and security surcharges in Indonesia and Malaysia for cargo flown to New Zealand over a period of nearly four years from October 2001 (security surcharges) and from mid-2002 (fuel surcharges). The penalty was recommended to the court by both the Commerce Commission and SIA Cargo as part of a pre-trial settlement and included a 20% discount to recognise SIA Cargo’s admissions. SIA Cargo was also ordered to pay costs to the Commission.

The Commission agreed to discontinue its proceedings against Singapore Airlines Limited, the parent company of SIA Cargo. SIA Cargo took over Singapore Airlines’ cargo operations in mid-2001.

"The Commission is pleased to have settled with another airline in this significant case. Price fixing is unlawful and the fines imposed in the air cargo case should be a deterrent to others who might breach the Commerce Act. The fines are also a reminder to companies that it is important to have effective compliance programmes in place to prevent anti-competitive behaviour," said Commerce Commission Chair Dr Mark Berry.

SIA Cargo and Singapore Airlines were among the 13 airlines the Commission filed proceedings against in December 2008, alleging that the airlines colluded to impose fuel and security surcharges for air cargo shipments to and from New Zealand.

Background
Section 30 of the Commerce Act makes price-fixing agreements between competitors unlawful. This includes agreements with the purpose, effect or likely effect of fixing, controlling or maintaining prices, or that provide a mechanism for doing so. An agreement can be a formal document, such as a contract. An agreement can also be very informal.

A company that contravenes section 30 may be ordered to pay penalties under section 80 of the Commerce Act. The penalty must not exceed the greater of:
• $10 million
• or, if it can be readily ascertained and if the Court is satisfied that the contravention occurred in the course of producing commercial gain, three times the value of any commercial gain resulting from the contravention
• or, if the commercial gain cannot be readily ascertained, 10% of the turnover of the body corporate and all of its interconnected bodies corporate (if any).


© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Gareth Morgan: The Government’s Fresh Water Policy – Revisited

Fresh water quality is the latest area to be in the sights of Gareth Morgan and his research organisation The Morgan Foundation... They found that the fresh water policy was a bit murkier than the Environment Minister let on. More>>

ALSO:

Interest Rates: RBNZ Hikes OCR To 3.5%, ‘Period Of Assessment’ Now Needed

Reserve Bank governor Graeme Wheeler raised the official cash rate as expected, while signalling a pause in rate hikes to assess the impact of moves so far this year. The kiwi dollar sank after Wheeler said its strength was “unjustified” and that the currency could have “a significant fall.” More>>

ALSO:

Fonterra: Canpac Site 'Resize' To Focus More On Paediatrics

Fonterra is looking at realigning its packing operations at Canpac, in the Waikato, to focus more on paediatric nutritionals... The proposed changes could mean around 110 roles may not be required at the site which currently employs 330. More>>

ALSO:

Scoop Business: Postie Plus Brand Gets 2nd Chance With Well-Funded Pepkor

The Postie Plus brand is getting a new lease of life after South Africa’s Pepkor bought the failed retailer’s assets out of administration and said it will use its purchasing power to reduce costs of stock and fatten margins. More>>

ALSO:

Warming: Warming Signs From State Of Climate Report

Climate data from air, land, sea and ice in 2013 'reflect trends of a warming planet' -- says the latest State of the Climate report, launched by U.S. and New Zealand scientists. More>>

ALSO:

Scoop Business: Embrace Falling Home Affordability, Says NZIER

Despair over the inability to afford a house is misplaced and should be embraced as an opportunity to invest in more wealth-creating activity, says the principal economist at the New Zealand Institute of Economic Research, Shamubeel Eaqub. More>>

Productivity Commission: NZ Regulation Not Keeping Pace

New Zealand regulators often have to work with out-of-date legislation, quality checks are under strain, and regulatory workers need better training and development. More>>

ALSO:

Get More From Scoop

 
 
Computer Power Plus

Standards New Zealand

Standards New Zealand
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news