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Qantas fined again

Qantas fined again

Qantas has been fined $12.1 million for being part of a freight cartel.This is the fifth time the airline carrier has received penalties in the last three years.The European Commission announced…

Qantas has been fined $12.1 million for being part of a freight cartel.

This is the fifth time the airline carrier has received penalties in the last three years.

The European Commission announced early today (10 November) that it has imposed fines totalling $1.1 billion on 11 cargo carriers for engaging in anti-competitive conduct between late 1999 and early 2006.

The Commission found that the cartel colluded to set surcharges for fuel and security on flights to and from European destinations.

"It is deplorable that so many major airlines coordinated their pricing to the detriment of European businesses and European consumers," European competition commissioner Joaquin Almunia said in a statement.

Qantas received one of the lowest fines of the 11 companies involved.

Qantas media relations manager Simon Rushton told Lawyers Weekly the airline has "acknowledged the improper conduct by the Qantas Freight division over this period".

"Qantas was a leniency applicant and we have fully co-operated with the EC. We have also fully cooperated with all other global regulators," he said.

Rushton added that Qantas will look at the fine by the European Commission "in detail", once it receives the full decision next week.

Air France-KLM and British Airways were dealt the biggest penalties, with fines of $423.7 million and $143.3 million respectively. Other carriers to receive penalties in excess of $100 million included Cargolux ($109.7 million) and Singapore Airlines ($102.7 million). Scandinavia's SAS Group, Cathay Pacific, Air Canada, Martinair, Japan Airlines and Lan Chile were also fined.

The cartel was exposed from within after the German carrier Lufthansa blew the whistle and alerted authorities. It was spared any penalties for its co-operation with the Commission.

It was also announced by the Commission that an additional 11 carriers and one consultancy firm were investigated, with no charges being laid.

Qantas has previously received fines of $71.6 million from the US Justice Department in November 2007 for price fixing in the air freight industry and a $20 million penalty from the Australian Competition and Consumer Commission in 2008 for breaching price fixing rules.

It was also fined $127,271 by the South Korean Fair Trade Commission in May this year for its part in a 19 member cartel that fixed fuel surcharges on cargo routes.

The latest penalty imposed on Qantas caps continues a recent run of bad news for the once iconic Australian company.

Earlier this month, Qantas had to ground its A380 fleet after problems emerged with its Rolls Royce designed engines.

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