http://www.yourlawyer.com/topics/overview/Air_Cargo_Price_Fixing Sat, 21 Nov 2009 07:08:38 -0800 pixel-app en http://www.yourlawyer.com/articles/read/12453 Mon, 01 Jan 2007 00:00:00 -0800 http://www.yourlawyer.com/articles/read/12453  
In a statement issued by the company it was noted that the investigation was being conducted into a long list of airlines as part of a global investigation which started in the US and Europe several months ago.
 
The investigation, announced publicly in February, relates to the air cargo pricing practices of a number of airlines. It is believed to focus on allegations of industry collusion in the United States and Europe to fix prices on surcharges for fuel. Airlines and cargo carriers, use surcharges to help offset rising fuel costs.
 
Several major air-cargo carriers were raided by U.S. and European antitrust enforcers as part of a trans-Atlantic investigation into possible price-fixing and collusion in air cargo.Federal Bureau of Investigation agents raided airlines facilities at New York's Kennedy Airport, confiscating computers and gathering documents.
 
The European Commission conducted its own raids at the same time, saying it had carried out "unannounced inspections" of airline facilities and offices in Europe.]]> http://www.yourlawyer.com/articles/read/11575 Fri, 17 Feb 2006 00:00:00 -0800 http://www.yourlawyer.com/articles/read/11575
Korea Fair Trade Commission officials visited the company on Tuesday, said airline spokeswoman Nancy Park. She said Korean Air was cooperating, but had no details on what the regulators were seeking.

"We're cooperating with them and making sure they get what they need," Park said. The investigators visited Korean Air for "at least a couple of hours," she said.

Since Tuesday, more than a dozen airlines including Singapore Airlines Ltd., Japan Airlines Corp., Hong Kong's Cathay Pacific Airways Ltd., British Airways PLC, Germany's Lufthansa AG and South Korea's Asiana Airlines Inc. have said authorities in the United States, Europe and Asia have either visited their offices or issued subpoenas.

Officials for the European Commission, the U.S. Department of Justice and the Federal Bureau of Investigation refused Wednesday to provide details about the probe.

The Korea Fair Trade Commission, South Korea's antitrust regulator, issued a brief statement Wednesday to say it had investigated local and foreign airlines, which it didn't identify. It has refused further comment.

One of the foreign airline's targeted, SAS AB's SAS Cargo in Copenhagen, Denmark, said the EU has alleged that cooperation among airlines began in 2000 and involved agreements about surcharges imposed by airlines to offset certain external costs.]]> http://www.yourlawyer.com/articles/read/11578 Thu, 16 Feb 2006 00:00:00 -0800 http://www.yourlawyer.com/articles/read/11578
South Korea's Asiana Airlines Inc., Japan's Nippon Cargo Airlines Co. and Singapore Airlines Ltd. all said they had either been visited or contacted by regulators or court officials this week.

Since Tuesday, more than a dozen airlines, including Japan Airlines Corp., Hong Kong's Cathay Pacific Airways Ltd., British Airways PLC and Germany's Lufthansa AG, say American and European authorities have visited their offices or issued subpoenas.

Spokespersons for the European Commission, the U.S. Department of Justice and the Federal Bureau of Investigation refused Wednesday to provide details about the investigation.

But one of the foreign airline's targeted, SAS AB's SAS Cargo in Copenhagen, Denmark, said the EU has alleged that cooperation among airlines began in 2000 and involved agreements about surcharges imposed by airlines to offset certain external costs.

Singapore Airlines said in a statement Thursday that its cargo division had "received requests for information from the U.S. and European authorities, and has provided the information sought. SIA Cargo will cooperate fully with the authorities."

Asiana confirmed its offices in Seoul were visited and documents were inspected by South Korean antitrust authorities on Tuesday, according to spokesman Jason Kim.

Nippon Cargo Airlines said officials from the U.S. District Court of the District of Columbia left papers at the company's office at New York's John F. Kennedy airport Tuesday to appear at the court by April, according to spokesman Yuhei Yamashita. The papers did not say why they were being asked to show up, he said.

Japan Airlines Corp., Nippon Cargo and All Nippon Airways said they have not been contacted by Japanese regulators so far.

Kim Joo-hyuck, a spokesman at the Korea Fair Trade Commission, refused to provide the names of airlines investigated Tuesday in South Korea. The commission released a brief statement on Wednesday saying checks of local and foreign airlines took place in cooperation with similar actions by authorities in the United States and Europe.

Korean Air Co., South Korea's largest airline and the world's biggest international cargo carrier, confirmed Wednesday only that commission officials visited the airline. Calls to the airline's corporate communications department went unanswered all day Thursday.

Japan Airlines spokesman Yoshiteru Suzuki said the airline was searched and questioned Tuesday in Frankfurt and New York by EU antitrust authorities, U.S. Justice Department anti-monopoly officials and the FBI.

The investigation was about cargo operations and seemed to be based on suspicions of a cartel, he said.

For the October-December quarter of 2005, JAL's revenue in international cargo totaled 53.2 billion yen ($451 million) nearly 10 percent of overall revenue for that period.

With details of the probe still unclear, analysts in Asia were reluctant to speculate about what the impact on the industry might be.

"We're not even sure what's prompting the regulators to get upset," said Peter Hilton, regional transport analyst at Credit Suisse in Hong Kong. "It's clearly an issue that warrents monitoring for sure."

Kim Seung-chul, an analyst at Kyobo Securities in Seoul, cautioned, however, that for airlines like Korean Air and Asiana where cargo operations account for a significant amount of total sales, penalties could have an impact on profitability.

The 17-member Association of Asia Pacific Airlines based in Kuala Lumpur, Malaysia, said the regional airlines with the highest percentage of cargo revenue as a portion of total sales in 2004 were Eva Air and China Airlines, both of Taiwan, at 46.6 percent and 43.5 percent, respectively.

They were followed by Korean Air at 32.7 percent, Asiana at 29 percent and Cathay Pacific at 28.5 percent.]]> http://www.yourlawyer.com/articles/read/11574 Wed, 15 Feb 2006 00:00:00 -0800 http://www.yourlawyer.com/articles/read/11574
Officials with the European Commission and U.S. Department of Justice have provided few details about the probe and the searches that were carried out on Tuesday.

However, one of the airlines targeted, SAS AB’s SAS Cargo in Copenhagen, Denmark, said the EU has alleged that cooperation among airlines began in 2000 and involved agreements about surcharges imposed by airlines to offset certain external costs.

Among the costs, according to SAS, are surcharges on fuel, added security after the Sept. 11 attacks and premiums for war-risk insurance after the start of the war in Iraq. SAS said in a statement it does not suspect any violations at its operations.

The raids on Tuesday involved only possible price fixing in air cargo, EU antitrust spokesman Jonathan Todd said Wednesday in Brussels, Belgium.

When asked if there was also an investigation into collusion in setting fuel surcharges for passenger flights, he said: “I cannot make any comment on any other investigation that may or may not be going on. At any one time, the commission has several hundreds of antitrust investigations going on, of which only a small proportion are in the public domain.”

The commission said Tuesday that the raids were a preliminary step in investigations into suspected cartels and it does not mean the companies raided are guilty of anti-competitive behavior.

Justice Department spokeswoman Gina Talamona confirmed Tuesday that U.S. investigators were working with the EU and other foreign authorities in the probe but declined to provide any details of the investigation.

Atlanta-based shipping giant UPS Inc. has been “informally contacted” by the Justice Department regarding the probe, company spokesman Norm Black said.

“UPS understands it is not part of the probe,” Black said. “As is its practice, UPS will cooperate with requests from government agencies.”

The largest U.S. airline, AMR Corp.’s American Airlines, said it has received a subpoena from the Justice Department but has not been told it was a target of the investigation, spokesman Tim Wagner said. “And unlike some other airlines,” he said, American didn’t receive a search warrant. He said the Fort Worth, Texas-based airline would cooperate fully with investigators.

United Airlines had its Frankfurt, Germany, office searched by EU officials, according to Chicago-based United spokesman Jeff Green. He said other air freight carriers in Frankfurt had similar visits. He said he was unaware of any other searches or inquiries involving other United offices or airports.

Meanwhile in Chicago, FBI spokesman Ross Rice confirmed Tuesday that the FBI had searched the Air France-KLM cargo terminal at O’Hare International airport as part of an ongoing investigation. He would not say what the investigation was about.

Among the other airlines that were searched or approached by investigators are Atlas Air Worldwide Holding Inc.’s Polar Air Cargo unit, Japan Airlines Corp., Hong Kong’s Cathay Pacific Airways Ltd., British Airways PLC, Germany’s Lufthansa AG, Luxembourg’s Cargolux Airlines and Lan Chile.

Most said they were cooperating with the probe.

In South Korea, the nation’s antitrust watchdog said Wednesday it had inspected local and foreign airlines in cooperation with similar actions by authorities in the United States and Europe. The commission did not mention what airlines were inspected.

But Korean Air Co. spokesman Cho Hyong-chol confirmed that officials visited that airline, adding that he had no details.]]> http://www.yourlawyer.com/articles/read/11577 Wed, 15 Feb 2006 00:00:00 -0800 http://www.yourlawyer.com/articles/read/11577
Hong Kong airline Cathay Pacific and Japanese flag carrier Japan Air Lines (JAL) were both drawn into the probe, which was launched by European and American investigators Tuesday.

Cathay Pacific said Wednesday it was among "a number of international airlines" caught up in the joint EU and US investigation.

In a statement, the company denied any wrongdoing and said it was cooperating with investigators.

"Cathay Pacific is in cooperation with the European Union Commission and United States Department of Justice in respect to their investigation into air cargo operations," the statement said.

"We understand that they have also requested information from a number of international airlines," it added.

A Cathay Pacific spokeswoman said the inspection of its premises had been unannounced but she would not characterise it as a raid.

"I don't know what happened elsewhere but in Hong Kong it was very business-like," the spokeswoman said. "Cathay is a law-abiding company."

Separately, Hirokazu Inoue, a spokesman for JAL said Asia's largest carrier had been raided.

"Our office in Frankfurt was raided by the European Union's anti-monopoly authorities," Inoue said.

"We have nothing to say about the matter as it is still under investigation but we will fully cooperate with the authorities on the investigation," he added.

In Seoul, officials said Fair and Trade Commission investigators interviewed employees and searched for documents at cargo business offices at Korean Air and Asiana Airlines in similar raids Tuesday.

EU inspectors raided the offices of major European airlines Tuesday but did not name the companies.

British Airways, however, said earlier Tuesday it had received a request for information from both the EU executive and the US Justice Department as part of a probe into a suspected cartel of airlines and air freight companies.

It added that it had alway conformed with anti-trust regulations and would cooperate with the EU and US authorities.

Air France and Deutsche Lufthansa AG said they were being investigated by the EU executive and would fully cooperate]]> http://www.yourlawyer.com/articles/read/11576 Tue, 14 Feb 2006 00:00:00 -0800 http://www.yourlawyer.com/articles/read/11576
The European Commission carried out surprise inspections Tuesday at several major Europeans airlines, while the U.S. Justice Department issued subpoenas.

British Airways, Air France, KLM, Lufthansa and Luxembourg's Cargolux Airlines all confirmed they were cooperating with authorities investigating the pricing practices in the industry.

The largest U.S. airline, AMR Corp.'s American Airlines, also said it has received a subpoena from the Justice Department as part of an investigation into practices in the air-cargo industry.

American was not been told it was a target of the investigation "and unlike some other airlines," didn't receive a search warrant, spokesman Tim Wagner said. He said the Fort Worth, Texas-based airline would cooperate fully with investigators.

United Airlines, a unit of UAL Corp., said its United Cargo office in Frankfurt, Germany received an inquiry from European authorities.

"We are giving the European authorities our full cooperation in this matter," spokesman Jeff Green said in an e-mail to The Associated Press. "United conducts its business in full compliance with European rules and regulations."

In Houston, a spokeswoman for Continental Airlines Inc. said that carrier had not received a subpoena.

Also Tuesday, Justice Department officials searched Japan Airlines' cargo offices at New York's JFK International Airport, airline spokesman Steve Pearlman said Wednesday in Tokyo. EU officials also searched JAL offices in Frankfurt.

In a brief statement to the London Stock Exchange, British Airways PLC said it had received a request for information from both the European Commission and the Department of Justice and was assisting in the probe.

Justice Department spokeswoman Gina Talamona said that U.S. investigators are working with the EU and other authorities to investigate possible "anti-competitive behavior."

Patrick Jeanne, a spokesman for cargo airline Cargolux Airlines International SA, said the carrier had been visited Tuesday by EU inspectors.

KLM spokesman Hugo Baas confirmed KLM is included in the probe and that investigators were at the company today. He said KLM is extending "full cooperation, and we have all the faith in the outcome of the investigation."

Lufthansa AG and Air France issued similar statements pledging cooperation. KLM and Air France are part of Air France-KLM Group.

The EC said surprise inspections are a preliminary step in investigations into suspected cartels.

"The fact that the European Commission carries out such inspections does not mean that the companies are guilty of anti-competitive behavior nor does it prejudge the outcome of the investigation itself," it said in a statement.

It provided no further detail of what was being examined and put no time frame on the completion of its investigation.

BA said its policy is "to conduct its business in full compliance with all the applicable competition laws."

The airline said it had no immediate comment beyond its statement.

LAN Cargo, the cargo division of Chile's flag airline LAN Chile, said Tuesday that U.S. government officials appeared at its Miami office as part of the probe.

The company said in a statement that "it is giving maximum cooperation to the authorities in charge of the investigation."]]> http://www.yourlawyer.com/topics/overview/Air_Cargo_Price_Fixing Tue, 14 Feb 2006 00:00:00 -0800 http://www.yourlawyer.com/topics/overview/Air_Cargo_Price_Fixing Air Cargo Price Fixing

U.S. and European regulators have launched an investigation into illegal price fixing among the largest names in the air cargo industry. Regulators believe that airfreight carriers may have conspired with each other to control pricing. More than a dozen airlines are believed to be part of the investigation, including: Lufthansa, Lan Chile, Air France, British Airlines, Japan Airlines, Korean Airlines, American Airlines, SAS, Asiana Air, Polar Air, Cathay Pacific, Atlas Air, and Cargolux. The U.S. Justice Department and the European Commission are conducting the antitrust investigation.

For years businesses that have relied on airfreight transport have complained about suspicious industry pricing. Investigators are focusing on whether these companies colluded to fix prices on surcharges for fuel, security and insurance. Industry insiders believe the probes must involve the fuel surcharge formula devised by Lufthansa, which is used by many carriers around the world. This formula calls for a review of fuel prices every two weeks and adjusts surcharges accordingly.

It is against the law in most countries for companies to collude to set prices or divide territory. Price fixing activity in the United States is a criminal offense and can result in prison terms, while in the EU companies face fines that are capped at 10 per cent of annual turnover. If your business has been the victim of airfreight price fixing, contact Parker & Waichman, LLP today for a free case evaluation.
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