Top airlines at centre of price-fixing probe

Japan Airlines and Cathay Pacific Airways say they are among at least 10 global airlines under investigation by the European Commission and the United States Justice Department into price fixing in the air cargo market.

"We are co-operating with the investigation," Japan Airlines spokeswoman Yuko Takahashi said, confirming that the Tokyo-based airline's Frankfurt office had been raided.

Hong Kong-based Cathay Pacific said investigators visited its offices in Frankfurt, Los Angeles and San Francisco.

The global air cargo industry is under scrutiny for the way airfreight rates are fixed. Under European Union law, the EC can impose a fine of as much as 10 per cent of annual sales for cartel-like behaviour. It typically opts for about 2 per cent to 3 per cent of sales.

"The commission has reason to believe that the companies concerned may have violated" EU cartel rules, the Brussels-based commission said.

EU investigators visited the offices of British Airways, Deutsche Lufthansa and Air France-KLM, the carriers said.

AMR's American Airlines unit received a subpoena and UAL's United Airlines received an "inquiry" from EU officials through its United Cargo office in Frankfurt, according to the carrier's spokesman, Jeff Green.

"The antitrust division is investigating the possibility of anticompetitive practices in the air cargo industry," a US Justice Department spokeswoman said.

Polar Air Cargo, a unit of Atlas Air Worldwide Holdings, also had a request for information related to the US Government probe. The company said it was co-operating fully.

LAN Cargo, a division of Chile's LAN Airlines, said investigators had visited its offices in Miami.

Separately, South Korea's two largest carriers - Korean Air Lines and Asiana Airlines - said they had been visited by the nation's Fair Trade Commission.

Neither airline said what the investigation was for.

- BLOOMBERG