ACCC LAUNCHES APPEAL ON FLT PENALTIES
Written on the 9 May 2014
THE AUSTRALIAN Competition and Consumer Commission (ACCC) has lodged a cross-appeal in relation to a federal court judgement against Flight Centre (ASX: FLT) in December claiming the penalties imposed were not harsh enough to provide adequate deterrence.
The court found in December 2013 that FLT competed with international airlines for the retail or distribution margin on the sale of international air fares and that, on six occasions between 2005 and 2009, FLT had attempted to induce an anti-competitive arrangement with those airlines to eliminate differences in air fares so as to maintain FLT’s margins on each of those six occasions.
The judgment was handed down in March ordering FLT to pay penalties totalling $11 million.
The ACCC cross-appeal will contend that four of the penalties do not provide adequate deterrence, given the findings about the nature of the conduct and the size and financial strength of FLT.
“The penalties imposed in competition cases are hugely important to deter anti-competitive conduct,” says ACCC chairman Rod Sims (pictured).
“The ACCC is concerned generally to ensure that penalties for anti-competitive conduct in breach of the law are not viewed commercially as being an acceptable cost of doing business.”