More pain for Qantas
CANBERRA – Qantas will be glad to see the back of 2008 after being fined $20 million yesterday for price fixing.
Qantas has faced a series of safety and on-time performance issues this year amid tumbling public confidence in its services.
The competition watchdog, the Australian Competition and Consumer Commission (ACCC) yesterday warned there are no hiding places for those involved with cartels after potential merger partners Qantas and British Airways were ordered to pay $25 million for price-fixing millions of dollars of freight.
Qantas admitted that it had exchanged assurances with other airlines about implementing freight fuel surcharges and that it reached collective agreements in certain Asian countries.
BA admitted it had arrived at an illegal understanding with Lufthansa about price-fixing on international air cargo services.
The Federal Court accepted the proposed fine and ordered Qantas pay the $20 million, plus a $200,000 contribution to the ACCC’s costs. It ordered BA to pay $5 million, plus $200,000 in costs to the ACCC.
ACCC chairman Graeme Samuel said the airlines had received relatively small fines because they had co-operated with its investigation.
“This action and the recent introduction of the bill criminalising cartel conduct will create a much stronger disincentive for cartels forming and continuing,” Samuel said.
“It will also step up pressure on cartel members to take advantage of the ACCC’s immunity and co-operation policies to report their fellow cartel members before they find themselves facing possible time behind bars. There are no safe havens for illegal cartel conduct.”
In November last year, the US Department of Justice fined Qantas US$61 million for its international involvement in price fixing.
Qantas still faces an Australian class action potentially worth millions of dollars taken by hundreds of businesses against seven airlines.
Ian Jarrett
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