EU Court Overturns Decision to Fine Airlines in Cartel Case -- Update

By Tom Fairless 

BRUSSELS--The European Union's second-highest court has overturned a decision to impose EUR790 million ($864 million) of fines on more than a dozen airlines including Air France KLM and British Airways for operating an airfreight cartel.

In a statement published Wednesday, the Luxembourg-based General Court of the EU said the European Commission's 2010 decision was contradictory because it accused the carriers of operating a single cartel, but only highlighted actual legal infringements by some carriers on some routes.

The court's decision can be appealed at the European Court of Justice, the EU's highest court, on "points of law only," the General Court said.

The European Commission, which acts as the bloc's top antitrust authority, didn't immediately respond to requests for comment.

If the ruling is confirmed, or goes uncontested, Air France KLM and British Airways could each avoid more than EUR100 million of antitrust fines. Air France KLM was fined more than EUR300 million--jointly and severally with Société Air France and Koninklijke Luchtvaart Maatschappij--for participating in the cartel, while British Airways was fined EUR104 million.

The other airlines allegedly involved were Air Canada, Cargolux Airlines International, Cathay Pacific Airways, Japan Airlines Corp., Latam Airlines Group, Deutsche Lufthansa, Martinair Holland, Qantas Airways, SAS and Singapore Airlines.

Cargolux, based in Luxembourg, said in a statement it welcomed the court's decision "including the full annulment of the EUR79.9 million fine previously levied on Cargolux."

The case began in late 2005, when Lufthansa alerted EU antitrust officials to anticompetitive behavior between several carriers in relation to fuel and security surcharges, and sought immunity. Following a series of raids in early 2006, the European Commission decided in 2010 that several carriers had coordinated their behavior. Its decision mentioned four specific infringements relating to specific periods and routes.

Several carriers contested the decision, arguing there was a contradiction between the EU's reference to a single global cartel and the four legal infringements actually named.

The General Court agreed with those complaints, ruling the actual legal infringements referred "to either four separate single and continuous infringements or just one single and continuous infringement." Liability for those is attributed only to the carriers that participated directly or were aware of the collusion on those routes, the court said.

Write to Tom Fairless at [e-mail]

(END) Dow Jones Newswires

December 16, 2015 10:59 ET (15:59 GMT)

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