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European Commission re-imposes cartel fine on 11 air cargo carriers

LBR Staff Writer Published 21 March 2017

The European Commission has re-adopted a decision to fine 11 air cargo carriers a total of €776m for operating a price–fixing cartel.

The EC’s original decision has been nullified by the General Court on procedural grounds.

In November 2010, the commission had imposed a fine of about €800m on 11 air cargo carriers for operating a price-fixing cartel from December 1999 to February 2006.

The price-fixing cartel was carried out in the airfreight services market, which covered flights from to and within the European Economic Area.

The cartel arrangements included multiple contacts between airlines ranging from bilateral and multilateral level to fix the level of fuel and security surcharges.

Air Canada, Air France-KLM, British Airways, Cargolux, Cathay Pacific Airways, Japan Airlines, LAN Chile, Martinair, Qantas, SAS and Singapore Airlines are the companies fined in 2010.

Except Qantas, the remaining firms challenged the 2010 decision before the EU's General Court.

Last December, the General Court invalidated the Commission’s decision against the 11 cartel participants and concluded that there had been a procedural error.

EC competition policy in charge commissioner Margrethe Vestager said: “Millions of businesses depend on air cargo services, which carry more than 20% of all EU imports and nearly 30% of EU exports.

“Working together in a cartel rather than competing to offer better services to customers does not fly with the Commission. Today's decision ensures that companies that were part of the air cargo cartel are sanctioned for their behaviour.”

Image: Head office of the European Commission. Photo: courtesy of Amio Cajander.