Cartel behaviour leads to second big air freight fine

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The Commerce Commission signalled more proceedings against freight forwarders after finding there has been cartel behaviour within the industry.

Yesterday, the commission said the High Court at Auckland had endorsed a second settlement against a company, imposing a $2.5 million penalty against Geologistics International (Bermuda) Ltd and ordering it to pay the commission's $50,000 court costs.

On December 16, EGL Inc was ordered to pay $1.15 million and $50,000 costs for anti-competitive conduct involving a security surcharge.

Geologistics was found to have contravened the Commerce Act by entering into and giving effect to the Air AMS surcharge agreement together with other freight forwarders. The surcharge related to United States customs clearance for goods air freighted from New Zealand.

In 2007, the commission began investigating alleged collusion by several multinational freight forwarding companies. This followed a confidential application for leniency by one of the involved companies.

The commission's enforcement general manager, Kate Morrison, said yesterday: "Because of the distance from our biggest markets and sources of supply, it's vital air freight services are subject to competition between freight forwarders."

- NZPA