Qantas Reserves $40m Pending Freight Price-Fixing Fine
Qantas, the national carrier of Australia, stated on Monday August 13th 2007 that it had isolated a figure of $40 million, pending a possible fine in respect of alleged price-fixing by the airliner’s freight division.
US regulators, as well as their counterparts in Australia, New Zealand and Europe have been looking into claims of this price-fixing across the air freight spectrum. According to Qantas itself: "These investigations revealed that the practice adopted by Qantas Freight and the cargo industry generally to fix and impose fuel surcharges was likely to have breached relevant competition laws."
This, the airline detailed in a statement issued on Monday August 13th 2007. It continued: "To date, it has not been possible to quantify any direct or indirect liability associated with these matters."
Two weeks earlier, Qantas said, an announcement was made by the US Justice Department, in which it detailed how both Korean Air and British Airways had admitted to taking part in price fixing, in relation to both passenger and freight flights. The resultant fines for both carriers were $300 million. In the case of British Airways, at least $200 million of this was in respect of its freight operations.
On this basis, stated Qantas, it had been decided to set aside a certain amount of its own pending discovery of and fines issued for “unacceptable conduct”. "Based on these (BA/Korean Air) developments, a decision has been made to make a $US40 million ($A47 million) provision in the 2006/07 financial accounts," Qantas confirmed.
According to the airline’s Chief Executive, Geoff Dixon, Qantas has well-defined policies under which it complies with national/international air travel laws. He added: "We have investigated this issue thoroughly and are confident that the unacceptable conduct was limited to a small number of people."
Qantas has refused to comment further at this stage, given the regulatory nature of the current investigations into its alleged price-fixing. However, Airport International will continue to provide the most up to date information on this topic as more facts emerge.
Source – Airport International’s Australasian Reporter
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