Legal Air News Update………Qantas facing very stiff fines
A legal air news update, brought to you by leading aviation lawyers Piper Alderman, says that the big news in the legal sphere of the aviation world last week was the $US300 million fine imposed on British Airways and Korean Air Lines Co after pleading guilty to charges of conspiring to fix the prices of passenger and cargo flights in the US District Court.
British Airways was also separately fined a record pounds stg 121.5 million by the UK Office of Fair Trading after admitting collusion over fuel surcharges on tickets. This was the largest ever penalty imposed by the Office of Fair Trading for violation of competition laws.
Qantas has admitted that it is “likely” that it also engaged in conduct that breached US competition laws in relation to its non-passenger cargo flights, and has submitted documents to the US Department of Justice to this effect.
In Australia, agreements between competitors that seek to fix, control or maintain the price for a good or service, or any discount, allowance, rebate or credit in relation to goods or services supplied or acquired is prohibited by s 45A of the Trade Practices Act 1974.
The Act imposes fines for such agreements of the greater of:
** $10 million;
** three times the gain from the contravention; or
** if the gain cannot be assessed by the Court, 10% of the annual turnover for the company and related companies.
The ACCC has previously shown that it will investigate and is prepared to bring proceedings against both foreign and domestic companies based on overseas proceedings for breach of competition law if the agreements were given effect to in Australia.
In 2001 the Federal Court imposed penalties of $26 million on three vitamin suppliers who gave effect in Australia to agreements on price and market share made overseas: ACCC v Roche Vitamins Australia Pty Ltd and Others [2001] FCA 150.
Keep watching the skies!
A Special Legal Air News Exclusive Update brought to you by leading aviation lawyers, Piper Alderman.
John Alwyn-Jones
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