Pricing and Fuel Surcharges Under Investigation

Governmental agencies in Europe and the US have requested data from a number of highly visible airlines and freight forwarders in an ongoing investigation into their billing practices. Several of these are only fact finding at this point in time with no indictments announced.

That is not true in the cases of British Airways and Korean Air that have pleaded guilty to price fixing on passenger flights and surcharges on passenger and cargo flights. The cases were brought by the US Department of Justice and UK Office of Fair Trading. Still waiting for a potential fine is Qantas Freight that is reported to have set aside $40 million for infractions. Qantas CEO, Geoff Dixon, has said that a small number of Qantas Freight employees may have engaged in conduct that might lead to the imposition of fines.

The investigation has been underway for two years and is reported to include cargo operations for a large number of airlines, among them SAS, Lufthansa, Air France-KLM, American Airlines, United Airlines, Cathay Pacific, Japan Airlines, LAN, Polar Air Cargo, Korean Air, Asiana Airlines, Singapore Airlines and ANA.

Freight forwarders that have been targeted include Kuehne+Nagel, EGL, Expeditors International and Schenker. All of those involved are cooperating fully with the investigative authorities.

Noting that as regards the freight forwarding industry, the European Commission has reason to believe that treaty rules may have been violated, Dr. Peter Sauer, vice president of Corporate Communications for Schenker, says that, “Free and unhampered competition is a top priority for Schenker. Consequently the company has assisted the representatives of the competition authorities in all matters connected with these investigations. Schenker will continue to contribute to the clarification of the facts of the case.”

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