OFT halves BA fine over price fixing scam
The Office of Fair Trading has massively reduced a £121.5 million fine against British Airways for a fuel surcharge scam.
The watchdog has more than halved the fine to £58.5 million as part of its new guidelines for financial sanctions and because BA had cooperated with the enquiry.
Although the penalty is significantly lower, it is still a record fine by the OFT.
BA admitted in 2007 that it had colluded with rival Virgin Atlantic over price fixing on long-haul flights between August 2004 and January 2006.
At that time, BA agreed to pay £121.5 million, but later reassessed its position when a criminal case against a number of current and former BA executives – Martin George, Andrew Crawley, Alan Burnett and Iain Burns – collapsed.
In a statement BA said: "We are pleased that this matter, which concerned events between 2004 and 2006, has been settled."
Virgin Atlantic escaped any fine because it blew the whistle on the collusion.
The OFT said the fine sends out a strong message that co-ordinating pricing through the exchange of confidential information between competitors is unlawful.
Ali Nikpay, OFT senior director of cartels and criminal enforcement, said: "The size of the fine underlines that it is important for companies to take steps to ensure that they have an effective compliance culture.
"The fine would have been higher still but for the co-operation provided by BA throughout the OFT’s investigation. Without this, together with BA’s admission of the infringement, the case would have taken considerably longer to resolve."
Bev
Editor in chief Bev Fearis has been a travel journalist for 25 years. She started her career at Travel Weekly, where she became deputy news editor, before joining Business Traveller as deputy editor and launching the magazine’s website. She has also written travel features, news and expert comment for the Guardian, Observer, Times, Telegraph, Boundless and other consumer titles and was named one of the top 50 UK travel journalists by the Press Gazette.
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