Air New Zealand strongly opposes access to court documents

Air New Zealand, one of eight airlines still to face what could be the country’s largest ever competition law trial next year, has strongly opposed a request by a German company for access to court documents.

The airline slammed the request in the High Court at Auckland yesterday, claiming Schenker AG, owned by the German government, sought only to use such documents offshore in other proceedings.

Schenker, the world’s second largest freight forwarding company, applied to the court for access to all legal documents associated with a long-running air cargo price fixing trial held in May.

That was the first stage of an on-going two-part trial involving eight airlines and established whether air cargo services into the country were part of a market in New Zealand.

The second stage will culminate next year in a substantive trial examining the price-fixing allegations.

“The airlines are concerned this is a fishing expedition for use [of the court documents] in procedures offshore,” Air New Zealand lawyer Simon Ladd told the court.

Schenker, which has New Zealand operations, was ordered in June to pay $1.1 million and costs of $25,000 for its part in the cartel investigation after reaching a settlement with the Commerce Commission.

However yesterday Schenker’s lawyer Paul Collins said as a customer of various airlines in the centre of the price-fixing allegations, Schenker would have been subject to illegitimate surcharges. He told Justice Raynor Asher it was entitled to access the documents, even if it included commercially sensitive material. It had nothing to do with trade rivalry though and only sought to establish the extent of any loss it may have suffered.

Air New Zealand and Malaysian Airlines have both said they want nothing to go to Schenker for various reasons including confidentiality and the fact the price fixing charges won’t be contested until next year’s trial.

There was, therefore, nothing for Schenker to gain in accessing court documents at this point.

DHL, the world’s largest freight forwarder, was also in court to oppose the application while the Commerce Commission has said it would prefer some of the documents to not be handed over.

The airfreight price fixing case saw competition regulators worldwide start investigating the air cargo industry in 2005.

In New Zealand the Commerce Commission started proceedings in December 2008 against 13 airlines, alleging they colluded to raise the price of freighting cargo by imposing fuel surcharges on cargo shipments in and out of New Zealand.

An action still remains against eight of the airlines – Air New Zealand, Cathay Pacific, Emirate, Japan Airlines, Korean Air, Malaysian Airlines, Singapore Airlines and Thai Airways. Air New Zealand has consistently denied any wrongdoing.

In April the High Court imposed penalties against British Airways and Cargolux International of $1.6 million and $6m respectively. Meanwhile Qantas reached a settlement in which it agreed to a $6m fine.

The commission has filed discontinuance notices against Garuda and six Air NZ executives.