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Thursday, November 25, 2010

Brussels fines BA £90m over cargo cartel

The European Commission found BA, Air France-KLM and nine other airlines guilty of fixing air freight prices over six years, after Germany's Lufthansa blew the whistle on the illegal arrangement.
EC competition watchdog Joaquin Almunia, branded the cartel 'deplorable' and said the fines - which amount to nearly £690m for all 11 airlines involved - showed that the Commission would 'not tolerate cartel behaviour'.
The former flag carrier has now been hit with £367m in fines in just three years, following an earlier scandal when it admitted to fixing fuel surcharges with transatlantic rival Virgin Atlantic.
This latest penalty exceeds expectations of a £70m bill for its anti-competitive behaviour.
But the airline said it has already set aside £350m to cover fines relating to both cases in its 2006-07 report, meaning the charge will not affect chief executive Willie Walsh's pledge to break even this year, after a record £531m annual loss.
And BA still hopes to shave a £121.5m fine from the Office of Fair Trading off its mountain of penalties, after a civil case over the collusion with Virgin collapsed

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