15 February 2008

UPDATED: &#pound;100m BA/Virgin price fix compensation agreed

Passengers in the UK who flew with British Airways and Virgin Atlantic over a period between 2004 and 2006 could receive refunds of more than &#pound;10 a flight.

This emerged after the two airlines agreed to pay passengers around &#pound;101 million in the settlement in the US of fuel surcharge fixing case on transatlantic routes.

Passengers who bought tickets in the UK between August 2004 and March 2006 may now split &#pound;73.5 million while those in the US could share $59 million, the Financial Times reported.

BA is believed to be paying &#pound;71 million and Virgin around &#pound;30 million.

Under the settlement, BA confirmed that passengers who bought tickets in the US or UK for travel on long-haul routes between August 11, 2004 and March 23, 2006, will be entitled to claim 33.3% of the fuel surcharge levied per long-haul ticket.

The settlement 'âœ worth approximately &#pound;1 - &#pound;11.50 for each coupon in the UK and approximately $1.50 to $20.50 in the US - will be referred to the District Court for approval.

BA said in a statement: "BA and Virgin Atlantic have agreed in principle a settlement to resolve the class action litigation pending in the US District Court for the Northern District of California, brought on behalf of US and UK passengers relating to alleged overcharges on long-haul passenger fuel surcharges."

The airline's chief executive Willie Walsh said: 'As we have previously said, we absolutely condemn any anti-competitive activity by anybody.

"This settlement, which British Airways and Virgin Atlantic have jointly agreed with the lawyers for the plaintiffs, is fair and reasonable.

"BA can now move on and do what we do best - delivering excellent customer service.'

US law firm Cohen, Milstein, Hausfield & Toll brought the suit against the airlines two years ago arguing that both carriers colluded to inflate their fuel surcharges on international flights.

BA was fined more than &#pound;121 million by the UK Office of Fair Trading for infringing competition law, while Virgin got off lightly having blown the whistle on the conspiracy. BA was fined a further $300 million for passenger and cargo price fixing by the US Department of Justice.

BA put aside &#pound;350 million towards the fines last year.

by Phil Davies