6 Jun 2013

Air NZ to settle over price-fixing claim

4:31 pm on 6 June 2013

Air New Zealand has done a sudden about-face, agreeing to settle with the Commerce Commission which alleges it conspired with other airlines to fix cargo prices.

In May this year, the airline withdrew from talks to settle the dispute, protesting that it was untenable for the commission to still be trying to enforce a settlement.

However, it now says it has withdrawn its challenge and will pay the commission's costs, believed to be well into seven figures. That is in addition to the more than $10 million it has spent on defending the charges.

The alleged offences date back to between 2000 and 2006 and involved surcharges levied for fuel and security.

In a joint statement with the commission, the airline said the parties are seeking the earliest available date for a hearing on the penalty Air New Zealand will have to pay, believed to be up to $10 million.

The Commerce Commission has dealt with the other 12 airlines involved, fining 10 a total of about $35 million.

In April this year, the High Court imposed penalties on three airlines. Cathay Pacific was ordered to pay $4.3 million, Thai Airways $2.7 million and Malaysia's MASkargo System Berhad $2.6 million.

Seven other airlines settled earlier, including British Airways, Japan Airlines and Qantas. Proceedings were discontinued against United and Garuda.