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BA execs face price-fixing trial

Aug 07 2008 14:39

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London - Four former and current British Airways executives will appear in court next month over price-fixing on fuel surcharges which has already led to record fines for the airline, officials said on Thursday.

British and US authorities have already fined BA a total of around £270m over the offences which took place between August 2004 and January 2006.

BA's current head of sales Andrew Crawley, former commercial director Martin George, former communications head Iain Burns and former UK and Ireland sales chief Alan Burnett could face jail sentences over the charges.

George, Burns and Burnett resigned from the airline in 2006.

The world's major airlines are adding surcharges to their tickets owing to the soaring cost of kerosene, the fuel used to power jets that it refined from crude oil.

Crude oil prices struck record highs last month above $147 per barrel but have since shed about 20% on fears of lower energy demand, analysts said.

Colluding with Virgin Atlantic

A spokesperson at City of London magistrates court said on Thursday: "A Burnett, I Burns, A Crawley and M George are listed to appear here on September 24 in an Office of Fair Trading (OFT) prosecution."

The four men are among 10 past and present BA staff who have been refused immunity under a plea agreement over the price-fixing between the airline and the US Department of Justice.

The OFT, the British watchdog, fined BA £121.5m for colluding with Virgin Atlantic Airways on fuel surcharges on at least six occasions in the 2004-2006 period.

Virgin was granted immunity after bringing the matter to the attention of the OFT.

BA was also fined $300m by the Department of Justice for a similar agreement with Korean Air.

In February, BA agreed to pay $136m in damages to passengers affected by the price-fixing to settle a US lawsuit.

BA chief executive Willie Walsh said this year that "any anti-competitive behaviour is to be condemned at BA or at other companies".

British Airways, which is currently in merger talks with Spanish airline Iberia, said last week that its net profit had plunged by 90% during the company's first quarter in the face of surging fuel costs and the economic slowdown.

- Sapa

 
 
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