Another Massive Fine as Container Shipping Giant Hit With RoRo Automobile Freight Conspiracy Penalty

US – WORLDWIDE – Compañía Sud Americana de Vapores (CSAV), the Chilean ocean freight company, which will become the world’s fourth largest container shipping line if plans to merge with German shipping group Hapag-Lloyd proceed as widely anticipated, has agreed to plead guilty and pay an $8.9 million criminal fine for its involvement in a conspiracy to fix prices, allocate customers and rig bids of international ocean shipping services for RoRo cargo, such as cars and trucks, to and from the US and globally.

According to the one-count felony charge, CSAV and its co-conspirators carried out the offences by way of meetings and communications to agree prices, allocate specific customers, and refrain from bidding against one another, whilst exchanging customer pricing information. The Justice Department said the companies then charged fees in accordance with those illicit agreements for international ocean shipping services for certain RoRo cargo to and from the US and elsewhere at the collusive and non-competitive prices.

CSAV participated in the conspiracy from at least January 2000 to September 2012 and the company has also agreed to cooperate with the department’s ongoing antitrust investigation. Bill Baer, Assistant Attorney General in charge of the Department of Justice’s Antitrust Division, said:

“Today’s [Thursday 27 February] charges are the first to be filed in the Antitrust Division’s investigation into bid rigging and price fixing of ocean shipping services. Because of the growth in the automobile ocean shipping industry over the past 40 years, the conspiracy substantially affected interstate and foreign commerce. Prosecuting international price-fixing conspiracies remains a top priority for the Division."

CSAV was charged with price fixing in violation of the Sherman Act, which carries a maximum penalty of a $100 million criminal fine for corporations. The maximum fine may be increased to twice the gain derived from the crime or twice the loss suffered by the victims of the crime, if either of those amounts is greater than the statutory maximum fine.

Editors Note: To see how widespread corruption has become in the freight and logistics sector and the billions of dollars of fines imposed, simply type a suitable keyword such as cartel into the News Search box at the head of this page.