$7.5m cartel fine for Thai Airways
The Asian airline is the 13th to have copped fines here after it admitted taking part in the cartel, which involved fixing rates for freight on international routes.
A Federal Court judge described Thai Airways' actions as "deliberate, systematic conduct involving senior staff" at its operations in Indonesia.
As part of the settlement, the airline admitted to deals to fix prices for fuel and security surcharges and a customs fee for air freight between Indonesia and Australia.
On top of the $7.5 million fine, Thai Airways has been ordered to pay $500,000 in court costs.
Singapore Airlines and Cathay Pacific were earlier fined $11.75 million and $11.25 million respectively for their part in the cartel.
The penalty imposed on Thai Airways takes the total amount airlines have been fined in Australia for taking part in the cartel to $98.5 million. It is the highest amount in fines from a single investigation by the Australian Competition and Consumer Commission.
In October, Emirates was fined $10 million for fixing fuel prices, a security surcharge and a customs fee on freight carried from Indonesia to Australia and other countries between October 2001 and May 2006.
ACCC chairman Rod Sims said the latest judgment sent a "strong signal to the business community that cartel conduct will not be tolerated".
The biggest scalp from the competition regulator's four-year investigation and subsequent legal pursuit has been Qantas, which was fined $20 million in 2008.
The fines Qantas has received worldwide total more than $105 million, including $US61 million in 2007 after it pleaded guilty to fixing air-cargo rates.
The Australian regulator still has legal action under way in the Federal Court against Air New Zealand and Garuda Indonesia.
The global cartel originated in 1996, when at least 17 airlines, including Qantas, introduced freight levies on air cargo to counter rising jet fuel costs.
Frequently Asked Questions about this Article…
Thai Airways was fined $7.5 million after admitting it took part in a global air‑freight cartel that fixed rates for fuel and security surcharges and a customs fee on freight between Indonesia and Australia. The airline was also ordered to pay $500,000 in court costs.
The penalties imposed on airlines in Australia for participation in the air‑freight cartel totalled about $98.5 million, making it the largest amount of fines from a single investigation by the Australian Competition and Consumer Commission (ACCC).
Several major carriers were penalised: Qantas was fined $20 million in 2008 (part of more than $105 million in worldwide fines), Singapore Airlines $11.75 million, Cathay Pacific $11.25 million, Emirates $10 million, and Thai Airways $7.5 million; the ACCC also has ongoing legal action against Air New Zealand and Garuda Indonesia.
The cartel involved fixing freight rates and introducing levies—such as fuel, security surcharges and a customs fee—on international air cargo to counter rising jet fuel costs. The global scheme originated in 1996, and some specific conduct targeted by the ACCC occurred between October 2001 and May 2006.
A Federal Court judge described Thai Airways' actions as 'deliberate, systematic conduct involving senior staff' in its Indonesian operations, and ACCC chairman Rod Sims said the judgment sends a 'strong signal' that cartel conduct will not be tolerated.
Yes. According to the article, the ACCC still has legal action underway in the Federal Court against Air New Zealand and Garuda Indonesia as part of its investigation into the cartel.
Everyday investors should note that cartel fines can be material to an airline's finances and reputation: the ACCC investigation has produced large penalties across multiple carriers, including Qantas and others, which can affect profits, legal costs and public trust. It's sensible for investors to be aware of regulatory risks when assessing airline investments.
Investors can monitor company announcements and financial reports for updates on legal exposure or provisions, follow ACCC case developments (including ongoing actions against Air New Zealand and Garuda Indonesia), and watch how airlines respond on compliance and governance—factors that can influence long‑term value and risk.
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