Emirates Airline fined $10m for Oz price fixing

Dubai airline ordered to pay up in dispute over fixing of surcharges

Travel, Emirates airline, Price fixing

A Federal Court in Sydney on Friday ordered Emirates Airline to pay a total of $10m in a dispute over the fixing of fuel and other surcharges.

It penalised the Dubai airline for "engaging in cartel conduct in breach of the Competition and Consumer Act 2010".

The decision comes just a week before the Australian Competition and Consumer Commission’s (ACCC) main proceedings are due to commence against a number of international airlines for alleged cartel conduct.

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Emirates Airline is the tenth airline to settle in these proceedings, the commission said in a statement.

“This settlement with Emirates brings the total penalties ordered in Australia against international airlines involved in the cartel to $68m. These are the highest penalties to have ever been ordered in an ACCC investigation,” said ACCC chairman Rod Sims.

“This result sends a strong message that the ACCC and the Australian courts will not tolerate any business – regardless of size or country of origin – engaging in cartel conduct that harms competition in Australia.

"Cartel conduct is illegal and often results in increased prices for consumers.”

The ACCC commenced the proceedings against Emirates in 2009, alleging that the airline, in conjunction with other airlines, fixed prices relating to fuel and other surcharges.

The ACCC said as part of the settlement, Emirates has admitted to "arriving and giving effect to illegal understandings relating to a fuel surcharge, a security surcharge and a customs fee on air freight carried from Indonesia to Australia and other countries between October 2001 and May 2006".

It also admitted "attempting to arrive at an understanding with DAS Air Cargo relating to rates charged for the supply of air freight services from Australia".

In addition to the $10m penalty, Justice Katzmann ordered Emirates to restrain from engaging in similar conduct for five years and to pay $500,000 towards the ACCC’s costs.

The ACCC’s proceedings against Singapore Airlines, Cathay Pacific, Air New Zealand and Thai Airways are due to be heard in the Federal Court in Sydney later this month.

“The ACCC has been pursuing this large and complex litigation for four years, so the October trial will be an important milestone in our continuing fight to stop cartel conduct,” Sims said.

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