Sun, May 29, 2011 - Page 1 News List

EVA fined in US price-fixing probe

By Kevin Chen  /  Staff Reporter

EVA Airways Corp (EVA, 長榮航空), the nation’s second-biggest airline, yesterday said it had agreed to pay a US$13.2 million fine to settle a US investigation into its role in a global price-fixing conspiracy in the air cargo industry.

The company said it reached the plea agreement with the US Department of Justice on Friday and would continue to cooperate in the department’s ongoing antitrust investigation.

The agreement is subject to US court approval, EVA said in a filing with the Taiwan Stock Exchange.

The US authorities accused EVA of participating in a global conspiracy to fix prices for certain international air shipments, including to and from the US, from January 2003 until February 2006.

“EVA and co-conspirators carried out the conspiracy by agreeing during meetings, conversations and other communications on particular cargo base rates or fees to be charged for certain international air shipments,” the US justice department said in a statement.

The airline is charged with price-fixing in violation of the Sherman Act, which carries a maximum fine for corporations of US$100 million, according to the statement.

EVA’s settlement is the latest in a price-fixing crackdown by the US authorities on international air shipments that has now led to charges against 22 airlines, including Taiwan’s leading carrier, China Airlines Ltd (CAL, 中華航空), and 21 executives.

CAL agreed to pay US$40 million in September last year to settle the US antitrust investigation into alleged price-fixing between January 2001 and February 2006. The company said at the time it would pay the fine in six installments over the next five years.

The US department said its investigation had thus far imposed more than US$1.8 billion in criminal fines and sent four executives to prison, with charges pending against the remaining executives.

Other international airlines that have reached plea agreements with the US authorities include Lufthansa AG, British Airways PLC, Air France-KLM, Japan Airlines Corp, Korean Air Lines Co, Cathay Pacific Airways Ltd, Northwest Airlines Corp and Qantas Airways Ltd.

EVA’s settlement also came as its sister company, Evergreen Marine Corp (長榮海運), said last week it was under a global antitrust investigation by the European Commission after the commission raided the company’s London office on May 17, along with those of A.P. Moller-Maersk A/S, CMA CGM SA and Hapag-Lloyd AG, for alleged price-fixing activities.

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