New Zealand watchdog takes airlines to court over cartel charges

Wellington - New Zealand's Commerce Commission filed criminal charges against three airlines for failing to cooperate in an inquiry into air-cargo price-fixing allegations and other anti-competitive conduct, the watchdog said Wednesday. 

The commission said Hong Kong-based Cathay Pacific Airways, Singapore Airlines and Aerolineas Argentinas in November refused to provide documents and information as requested under the country's Commerce Act. 

Commission chairwoman Paula Rebstock said the documentation was demanded as part of an inquiry into allegations that certain airlines had colluded and agreed on cargo rates, including fuel surcharges, on international flights to and from New Zealand. 

"Cartels are insidious and cause extensive damage to the New Zealand economy," she said. "They are difficult to detect and extremely difficult to investigate because of their secretive nature." 

Airlines earned more than 400 million New Zealand dollars (308 million US dollars) a year transporting air cargo to and from New Zealand, Rebstock said. 

A number of airlines were cooperating with the investigation, she added. British Airways, Korean Air, Australia's Qantas Airways, Japan Airlines and Air France KLM had settled and agreed to pay record fines after similar inquiries in the United States. 

"In total, the US courts have already awarded penalties of 1.2 billion US dollars against airlines for participation in a cartel that has increased air-cargo rates to and from the United States," she said. 

"At least one US air-cargo executive will pay a fine and also serve a sentence in a US prison as a result of his activity in a cartel," she said. (dpa)

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