28 October 2008

BA and Qantas fined in Australia over price fixing

British Airways and Qantas have been fined millions of pounds by Australian competition authorities over price fixing.

Qantas has agreed to pay $A20 million (Ã&#pound;8 million) in fines after reaching a settlement with the Australian Competition and Consumer Commission (ACCC) over price fixing on freight aircraft.

According to the ACCC, BA has also reached an agreement but it would not disclose how much the airline had been fined.

Both fines have to be approved by a judge.

This is the latest round of fines issued against airlines by competition authorities and follows action in the US and Europe.

Qantas has already agreed to pay a $61 million (Ã&#pound;39 million) fine in the US and earlier this year Bruce McCaffrey, Qantasââ¬â¢ former highest-ranking executive employed in the US, pleaded guilty and was sentenced to serve six months in jail and pay a $20,000 criminal fine.

BA has been fined a total of Ã&#pound;270 million after a joint investigation by the Office of Fair Trading and the US Department of Justice.

Earlier this month, Keith Packer, BAââ¬â¢s former commercial general manager for World Cargo, agreed to serve eight months in jail and pay a fine of $20,000 after pleading guilty to charges as part of the US investigation.

Today, Qantas chief executive Geoff Dixon said: ââ¬ÅâœQantas apologises unreservedly for the conduct of the employees involved.

ââ¬ÅâœAll Qantas employees are expected to comply with the law and we take any failure to comply very seriously.

ââ¬ÅâœSimilar investigations, involving more than 30 other airlines, continue in Europe and other jurisdictions and could take another two years to complete.

ââ¬ÅâœQantas will continue to cooperate with the ACCC and other antitrust regulators on these investigations.ââ¬~

He stressed that price fixing did not involve the companyââ¬â¢s passenger business.


By Bev Fearis

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• Who gets the money
  
  

  In cases like this, who actually receives the $A20 million? What, if anything, is ever done to attempt to repay those who were overcharged?

  By Mick Coleby, Wednesday, October 29, 2008
• So Why Should Governments Help Airlines?
  
  

  Once again, 'flag carriers' have been convicted / pleaded guilty of criminal activities - BA multiple times. So perhaps IATAs Giovanni Bisignani - formerly with Italia - can explain just why the long-suffering taxpayers of many countries should be supporting the airlines financially when they conspire to defraud their clients?

  By Jon Hewson, Tuesday, October 28, 2008