Cartel plea bargains to soar

NEW Zealand has fined a freight forwarder NZ$2.5 million (US$1.8 million) for its part in an air cargo price-fixing cartel. Geologistics International (Bermuda) agreed to pay the fine and NZ$50,000 ($37,000) in legal fees for agreeing airfreight surcharges with other freight forwarders on cargo between the US and New Zealand.

The judge presiding at the Geologistics case described the crime as “hard-core cartel behaviour”.

The Commerce Commission’s win in the New Zealand High Court now heralds further proceedings against the other companies involved. In addition, lawyers working on similar cases suggest that settlements will become increasingly common, with the result that more charges may be brought as governments seek ‘easy wins’.

Martin Klusmann (pictured), co-head of international law firm Freshfields Bruckhaus Deringer’s competition practice, and who has studied Europe’s recent anti-cartel activity said: “The success of the European Commission on cartel enforcement can largely be put down to the Commission’s leniency programme and intensified cooperation between competition authorities worldwide. Leniency programmes have proven particularly effective with more businesses cooperating in order to reduce or avoid fines altogether.”

Klusmann says cross-border cooperation between regulators was fairly novel earlier in the decade only occurring on the ‘big-ticket investigations’ but that it is now standard practice in competition enforcement and also in other regulatory areas.

For the full story read the latest free digital edition of Air Cargo News, no. 693 dated 10 January, here.