European Commission fines British Airways £90m for its role in an air cargo cartel


British Airways is one of 11 airlines to be fined (Source: Getty)

British Airways is to be fined €104m (£90m) by the European Commission for its role in a major price-fixing scandal dating back to 1999.

Some 11 airlines will be fined a total of €776m for their role in a cartel to fix fuel and security charges on flights to and within the European Economic Area between 1999 and 2006.

The EU Competition Commissioner Margrethe Vestager decided today to reinstate Brussels’ 2010 decision, annulled over a procedural error in 2015 after the airlines appealed. It had imposed a marginally higher fine of €799m, now lowered to reflect Martinair’s lower turnover and Quantas’ decision not to appeal the original fine.

The Commission had argued the group of airlines colluded to fix the price of new security measures in the aftermath of 9/11 terror attacks in the US and the case was never fully rejected.

British Airways, who today announced a new low-cost long-haul airline, told City A.M. "we note the decision and will be reviewing our position.”

Air France was fined €183m and KLM €127m. Other airlines fined include Air Canada, Cargolux, Cathay Pacific Airways, Japan Airlines, LAN Chile, Martinair, Qantas, SAS Cargo and Singapore Airlines.

“Working together in a cartel rather than competing to offer better services to customers does not fly with the Commission,” EU Competition Commissioner wrote in a statement.

Lufthansa and Swiss Air were initially considered to be part of the cartel but gained immunity after cooperating with authorities.

The share price of British Airways' parent company ICA was down 3.5 points to 567.50p in mid-afternoon.

Read more: Demand has quadrupled at British Airways' regional airline business