Qantas pays DOJ $61 million after confessing to cargo price-fixing

Qantas pays DOJ $61 million after confessing to cargo price-fixing

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Qantas Airways Ltd. has become the third airline to enter into a plea agreement with the U.S. Justice Department over the illegal fixing of cargo fuel surcharges from 2000 to 2006.
   The Australian airline will pay a $61 million fine to settle its liability in the United States.
   In August, British Airways and Korean Air Lines paid separate $300 million fines to the Justice Department after admitting their part in fixing passenger and cargo fuel surcharges.
   Geoff Dixon, chief executive officer of Qantas, said that facts revealed by the investigation related only to its freight division and did not involve the company’s passenger business. He understands more than 30 airlines are being investigated as part of the air freight probe by antitrust regulators across the globe.
   “These investigations confirmed that the practices adopted by Qantas Freight and the cargo industry generally to fix and impose fuel surcharges breached relevant antitrust laws,” Dixon said.
   “Qantas takes its obligations to comply with the law very seriously. We have a comprehensive competition compliance program in place, and expect all of our employees to comply with these requirements at all times. In this case, Qantas did not meet this expectation. The conduct was wrong and we apologize unreservedly for this.”
   Four past and two current employees of Qantas Freight have been excluded from the plea agreement and the DOJ has reserved the right to investigate these cases further.
   Dixon added that Qantas will continue to cooperate with the investigations being undertaken by the DOJ and other antitrust authorities, which could take up to two years to complete, and that the fines are unlikely to affect its financial results unduly.
   “Our 2006-2007 financial statements included a $40 million provision for the U.S. liability. We do not believe this or any further financial penalties will materially affect future operating results,” he said.