European court prepares to rule on TACA carriers’ $300-million fines

European court prepares to rule on TACA carriers’ $300-million fines    The Court of First Instance of Luxembourg will issue on Sept. 30 its long-awaited final judgement on the validity of an appeal by Trans-Atlantic Conference Agreement shipping lines against a decision containing large punitive fines made by the European Commission five years ago.
   The ruling, which follows hearings of parties in the case in March, will include a decision on whether to cancel, revise or confirm fines totaling 273 million ecu (about $300 million) imposed on TACA carriers by the European Commission in 1998.
   The fines hinged on the European Commission’s view that TACA carriers abused their dominant position and restricted the availability to shippers of individual service contracts in the transatlantic liner trade in the early 1990s. TACA carriers, who filed the appeal to the Court of First Instance of Luxembourg back in December 1998, have denied the charges and said that the fines were excessive.
   Matthew Levitt, partner with the law firm Lovells, said that he is keen to hear the outcome of the court case. The law firm represented TACA carriers before the court and has defended their position against EC accusations for the best part of the last decade.
      “A lot of money is at stake,” Levitt said. The $300-million fines were the largest ever imposed on a group of companies at the time.
   The Luxembourg court judgement is expected to be a lengthy, argued document of about 100 pages.
   Levitt said that the court has the power to increase fines, but that this is a very rare occurrence and is not expected in the TACA case.
   If TACA carriers lose the court case, they can appeal to the European Court of Justice, but only on points of law. In principle, shippers who have allegedly been over-charged or harmed by TACA’s anti-competitive practices could go to national courts to seek compensation if the Court of First= Instance upholds the 1998 decision of the
European Commission.