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Airlines' information request case resolved

27 April 2011

The Commerce Commission has withdrawn charges against Singapore Airlines Cargo Pte Ltd and Cathay Pacific Airways Ltd for failing to supply information in relation to the Commission's air cargo price-fixing case.

The Commission had alleged that the airlines had not complied fully with statutory notices to supply requested information as part of the Commission's cartel investigation.

"The Commission has resolved the matter with the airlines, who have now supplied the Commission with further relevant information. The Commission has now withdrawn the charges against them," said Mary-Anne Borrowdale, General Counsel for Enforcement, Commerce Commission.

"We are pleased that the issue is resolved. It is important that businesses respond to the Commerce Commission's requests for information promptly and comprehensively, so that we can conduct a thorough investigation and have the best possible information to base our decisions on."  

As the first stage of the cartel case in the Auckland High Court starts on 11 May 2011, the Commission can make no further comment at this time.


Background

Section 98 of the Commerce Act gives the Commerce Commission the power, in the context of a Commission investigation, to request that companies or individuals provide information within a reasonable but specific period of time. The information requested must be provided even if it implicates the provider in a breach of the Commerce Act. The information obtained through the use of statutory notices helps the Commission to assess in a timely manner whether a company or individual has breached the Commerce Act. If companies fail to supply the information within the specified time, charges can be laid under Section 103 of the Commerce Act.

Penalties for breaching section 103 of the Commerce Act are summary conviction and fines of up to $30,000 for companies and $10,000 for an individual.

In July 2008, the Commerce Commission filed criminal charges against Aerolineas Argentinas, Cathay Pacific Airways Ltd and Singapore Airlines Cargo Pte Ltd for non-compliance with section 98.

In January 2009, Aerolineas Argentinas pleaded guilty to failing to supply information requested by the Commerce Commission under section 98 of the Commerce Act. It was fined $11,000 in the Auckland District Court. Aerolineas Argentinas is not being prosecuted as part of the alleged international air cargo cartel.

 In June 2005, Koppers Arch (NZ) Limited and its former General Manager were convicted under section 103 of the Commerce Act. Koppers Arch was fined $25,000.

 In August 2006, Osmose New Zealand Limited and its former Australasian Group General Manager were also convicted under the same provision. They were fined $13,000 and $7,000 respectively.

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