Bermuda company guilty of price-fixing crimes

Posted by on Oct 3, 2010 in Local News & Alerts | 0 comments

By Kathy Shwiff/ The Wall Street Journal

A Bermuda-based freight company is caught up in a price-fixing scandal involving five other firms which consolidate cargo shipments. photo

Together, they have agreed to plead guilty and pay criminal fines totaling $50.3 million in a federal investigation, the U.S. Justice Department said Thursday.

The companies—EGL Inc., Kuehne + Nagel International AG, Geologistics International Management (Bermuda) Ltd., Panalpina World Transport (Holding) Ltd., Schenker AG and BAX Global Inc.—were accused of conspiring to fix prices for international air cargo shipments.

Each was charged with price fixing in violation of the Sherman Act, which carries a maximum fine of $100 million for each offense for corporations.

These are the first charges filed in the Justice Department’s antitrust investigation of the freight-forwarding industry. The probe is ongoing, and each company has agreed to cooperate with it.

More than a dozen airlines have settled with regulators—paying more than $1.5 billion in fines—amid probes into fuel surcharges by regulators in Europe, North America and Asia that have also ensnared freight forwarders, U.S. railroad operators and ocean-shipping companies.

According to the charges, the six freight forwarders were accused of conspiring to impose fees on customers purchasing international freight-forwarding services for air cargo to the U.S. between 2002 and 2007.

“The department’s investigation uncovered six different conspiracies harming businesses and consumers in the United States and across the globe,” said Assistant Attorney General Christine Varney, who is in charge of the Department of Justice’s antitrust division.

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