2007-08-05 - Preisabsprachen BABritish Airways hit by price fixing fines

Strafzahlung für Preisabsprachen<br /> U.K.-based British Airways and South Korean-based Korean Air Lines have each agreed to plead guilty and pay separate $300 million criminal fines for their roles in conspiracies to fix the prices of passenger and cargo flights, announced the US Department of Justice.

Today's plea agreements are the first to arise from the Antitrust Division's ongoing investigation into the air transportation industry. The charges against the two airline companies were filed in the U.S. District Court for the District of Columbia. Under the plea agreements, which are subject to court approval, British Airways and Korean Air have agreed to cooperate with the Department's ongoing investigation.
The Department said that passengers who flew on British Airways flights between the United Kingdom and the United States during the charged period paid more for their tickets as a result of the illegal cartel. In 2004, British Airways' fuel surcharge for round-trip passenger tickets was around $10 per ticket. By the time the passenger conspiracy was cracked in 2006, the surcharge was nearly $110 per ticket-a 10-fold increase, said the Department. The Department noted that during the air cargo conspiracy, British Airways' fuel surcharge on shipments to and from the United States changed more than 20 times and increased from four cents per kilogram of cargo shipped to as high as 72 cents per kilogram.
The Department charged Korean Air with agreeing with air cargo competitors on rates charged to customers in the United States and elsewhere for international air cargo shipments. The Department noted that the conspirators agreed to increase the fuel surcharge over time from 10 cents per kilogram to as high as 60 cents for each kilogram of cargo shipped from the United States. The Department also charged that Korean Air reached an agreement with its rival to fix certain passenger fares for flights from the United States to Korea.
British Airways has also admitted collusion over the price of 'long-haul passenger fuel surcharges' (surcharges) and will pay a penalty of £121.5m to be imposed by the OFT, thus enabling the OFT to close its civil investigation and resolve this case. The penalty will be the highest ever imposed by the OFT for infringements of competition law, and demonstrates the determination of the OFT to deal vigorously with anti-competitive behaviour. British Airways has admitted that between August 2004 and January 2006, it colluded with Virgin Atlantic over the surcharges which were added to ticket prices in response to rising oil prices. Over that period, the surcharges rose from £5 to £60 per ticket for a typical BA or Virgin Atlantic long-haul return flight. Virgin Atlantic is not expected to pay any penalty as it qualifies in principle for full immunity under the OFT's leniency policy. Under this policy, a company which has been involved in cartel conduct and which is the first to give full details about it to the OFT will qualify for immunity from penalties in relation to that conduct. In addition, any company staff involved in the price fixing disclosed will qualify for immunity from criminal prosecution in relation to that conduct. The OFT's investigation was prompted after Virgin Atlantic came forward with information about price fixing with BA over the surcharges. British Airways has also provided full co-operation with the OFT's investigation under the leniency programme and this is reflected in the penalty announced

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