10 May 2013

Air NZ accused of backtracking on settlement

5:29 pm on 10 May 2013

Air New Zealand is trying to backtrack on a financial settlement it made with the Commerce Commission after admitting it fixed cargo prices, a court has been told.

Overall, cases taken by international regulators for price-fixing have resulted in 35 airlines paying fines totalling more than $1 billion.

The Commerce Commission took action against 11 airlines operating in New Zealand.

Ten have been fined more than $35 million after settling with the commission for offences that took place between 2000 and 2006 and involved surcharges levied for fuel and security.

The commission's lawyer Brendan Brown told the Auckland High Court on Friday that Air New Zealand admitted fault in December last year and signed a settlement.

Mr Brown said Air New Zealand is now backtracking on that settlement by asking the High Court to declare the contract as void.

Air New Zealand's lawyer John Gailbraith said that was because key evidence retracted in a court in the United States shows that the case is no longer reliable. Details of this remain confidential due to court orders in the US.

The commission told Radio New Zealand the settlement did have an agreed financial penalty attached.

The airline and the commission will return to court next week.