EU: Court overturns decision to fine airlines in cartel case

Air France-KLM and 10 other airlines won a challenge against almost $874 million in fines for fixing air freight charges after Europe’s second highest court said it had found contradictions in the EU decision.

The European Commission said in a 2010 finding that 11 air cargo carriers fixed surcharges for fuel and security costs from December 1999 to February 2006, acting as a global cartel.

Air France took the biggest hit with a fine of 182.9 million euros while KLM came in second at 127.2 million euros. The two carriers merged to form Air France-KLM in 2004. British Airways’ penalty stood at 104 million euros.

The EU decision has since made the carriers a focus of damages claims from companies such as Germany’s Deutsche Bahn, carmaker BMW and car supplier Bosch.

The airlines subsequently challenged the EU antitrust enforcer’s decision. Judges agreed with their arguments on Wednesday, annulling the EU competition enforcer’s fines.

The court backed the airlines’ view that the Commission had considered four distinct cartel infringements, while the grounds for its decision were based on the sense of there being one single and continuous period of wrongdoing. The court said that penalized companies must be able to understand and to contest liability.

“The grounds and the operative part of the decision are contradictory,” the judges said.

The Commission said it would examine the ruling and the next steps.

Full content: The Wall Street Journal

Want more news? Subscribe to CPI’s free daily newsletter for more headlines and updates on antitrust developments around the world.