Air New Zealand has been fined $A15 million ($NZ16.24m) by an Australian court for price fixing between 2002 and 2007.

The Australian Federal Court has ordered Air New Zealand to pay these penalties after the Australian Competition and Consumer Commission (ACCC) launched legal action against a global air cargo cartel.

The Australian Court found that Air New Zealand agreed with other airlines to fix the price of fuel and insurance surcharges on air freight services from Hong Kong, and insurance and security charges from Singapore, to various locations, including Australian airports, between 2002 and 2007.

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ACCC Commissioner Sarah Court said the illegal price-fixing agreements “unfairly reduced competition for the transport cost for goods flown into Australia”. The ACCC launched an investigation into the air cargo cartel in 2006, and since then penalties totalling $A113.5 million have been imposed against 14 airlines.

Air New Zealand has been ordered to pay a penalty of $A11.5 million for price fixing over fuel surcharges imposed for cargo from Hong Kong to Australia. The other $3.5 million was for price fixing on the insurance and security surcharge from Singapore to Australia.

The fine to Air New Zealand was the second biggest after Qantas was fined $A20 million in 2008.

The Federal Court initially dismissed the ACCC’s case against Air New Zealand in 2014, but this was appealed in the Full Court of the Federal Court. Air New Zealand will also pay $A2 million in legal costs.

© Ben Williams

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