ACCC unsuccessful In Air Cargo Proceedings Against Air New Zealand and Garuda

ACCC unsuccessful In Air Cargo Proceedings Against Air New Zealand and Garuda

In a judgment handed down today in the Federal Court, Perram J dismissed allegations brought by the ACCC that Air New Zealand and Garuda had colluded between 2001 and 2006 with other Airlines to fix surcharges and fees for air cargo services in contravention of the TRADE Practices Act 1974 (TPA) now the Competition and Consumer Act 2010.  Perram J dismissed all the allegations on the basis that the conduct did not have the purpose or likely effect of substantially lessening competition in a MARKET in Australia, as required under s 45 of the TPA.

The alleged anti competitive conduct

The ACCC alleged that anti competitive conduct including price fixing had occurred in MARKETS in which cargo was flown from Hong Kong, Singapore and Indonesia into Australia.Through industry bodies in each of those overseas jurisdictions,the ACCC alleged that Airline representatives had met to fix fees and surcharges related to Aviation fuel fluctuations and increased insurance costs.  

In Hong Kong, the ACCC alleged that a published index of fuel surcharges the Lufthansa Index had been used as the basis for making joint applications to the Hong Kong government’s Civil Aviation Department.  The government department’s approval was necessary to impose any surcharge on Flights out of Hong Kong. The ACCC alleged that this constituted price fixing, while Air NZ and Garuda submitted they were obliged by Hong Kong law to lodge joint applications to the Civil Aviation Department.

In Singapore, Air NZ was alleged to have engaged in anticompetitive conduct by participating in discussions through the local industry body as to proposed fees and surcharges relating to fuel and insurance.  The ACCC alleged that this amounted to price fixing, or alternatively substantially lessened competition.  

In Indonesia, the ACCC alleged that Garuda used the Lufthansa Index as a basis for determining fuel surcharges and agreed customs fees at meetings of the local industry body.  It was alleged that this amounted to price fixing.  Garuda submitted that it was required to act as it did by Indonesian law and practice.

Civil Aviation Department,
Air New Zealand Cargo Track,
Air New Zealand Cargo Heathrow,
Air New Zealand Flight Tracker,
Air New Zealand Extra Baggage,
Air New Zealand New Zealand Site,
Air New Zealand Domestic,
Freight to New Zealand,
Cargo International,

Mohini Porwal [ B Sc]
Trainee News Editor
New Zealand Aviation News Editor


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