Reuters New Zealand

NZ watchdog files charges against airlines

Wednesday July 16, 03:51 PM

WELLINGTON, July 16 (Reuters) - New Zealand's competition watchdog has filed criminal charges against Singapore Airlines SIAL.SI, Cathay Pacific 0293.HK and Aerolineas Argentinas for not providing information sought as part of its investigation into alleged price-fixing, it said on Wednesday.

The Commerce Commission said it was investigating allegations that some airlines had colluded and reached agreements on cargo rates, including international fuel surcharges, on flights to and from New Zealand.

It said it had ordered the three airlines to provide information for its investigation by a specific date in November, but they had not complied.

"Any failure to comply with commission statutory notices that form part of a commission investigation is a serious enforcement issue," Commission Chair Paula Rebstock said in a statement.

Charges had been filed with the District Court and the firms could be fined up to NZ$30,000 ($23,077) each if found guilty.

Rebstock said if its broader investigation concluded that there was a case for price-fixing, it would file proceedings with the High Court.

"Cartels are insidious and cause extensive damage to the New Zealand economy," she said.

Air cargo services to and from New Zealand are worth more than NZ$400 million a year.

Regulators in the United States, the European Union and Australia have been pursuing airlines over alleged air cargo price fixing.

Last month Air France-KLM AIRF.PA and three other airlines agreed to pay fines totalling $504 million to settle a case brought by U.S. anti-trust officials.

Last year, British Airways Plc BAY.L and Korean Air Lines 003490.KS pleaded guilty and agreed to each pay a $300 million criminal fine for conspiring to fix cargo rates for international air shipments and to fix passenger fuel surcharges or fares for some routes.

On Jan. 14, 2008, Australia's Qantas Airways (ASX: QAN.ax) agreed to pay a $61 million criminal fine for cargo price-fixing. And last month, Japan Airlines 9205.T was sentenced to pay a $110 million criminal fine for similar price-fixing.

($1=NZ$1.30) (Reporting by Kazunori Takada, Editing by Mark Bendeich)

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