Charges Dropped Against Air Cargo Carrier Whilst Other Freight Airlines Await Actions

INDONESIA – UAE – NEW ZEALAND – News from Garuda Indonesia this week is all good, the national carrier was informed yesterday by the New Zealand Commerce Commission that all charges over its potential prosecution for air cargo cartel activity were to be dropped after alleged collusion on air freight fuel surcharges with twelve other carriers came to light as covered here previously.

 Garuda say it is looking forward to its first anniversary in the United Arab Emirates via its exclusive airline representative, general sales agents Air Cargo Trader (ACT). Garuda Indonesia has daily west-bound Airbus A330 aircraft to Amsterdam from Dubai and distributes all the European traffic via trucking arrangements from Amsterdam.

The east-bound cargo is carried on the return flights from Amsterdam to Jakarta via Dubai, connecting into the Far eastern network of Garuda, which includes Australia, Japan and China amongst the international destinations as well as domestic cities in Indonesia. The expected daily cargo capacity of twelve tons onboard the Airbus A330 aircraft can carry freight of all kinds on the principal operating routes and Garuda say they anticipate a rise in traffic levels.

For the remaining accused freight carriers the first stage of the cartel case starts on 11th May in the Auckland High Court and concerns whether air cargo services inbound to New Zealand are part of a ‘market in New Zealand’ such that the Commission can take action against them. The remainder of the case is scheduled to begin in July 2012 and will deal with the Commission’s allegations of price fixing.

In December 2008 the Commission commenced proceedings against 13 international airlines and eight airline executives, alleging the airlines colluded to raise the price of freighting cargo by imposing fuel surcharges on cargo shipments into and out of New Zealand. The conduct is alleged to have occurred over a period of more than seven years and charges against six Air New Zealand executives have also been dropped plus United Airlines have previously had their possible prosecution also dismissed.

“Discontinuing against these parties is part of the Commission’s overall strategy to streamline and focus the case on those airlines with large turnover in New Zealand markets,” said Commission General Counsel of Enforcement, Mary-Anne Borrowdale. With BA, Qantas and Cargolux having already been fined this leaves eight airlines plus two executives still facing possible action in New Zealand and eight still awaiting actions in Australia plus six cargo airline executives awaiting trial in the US.