ANZ rebuts price fixing charges, says deal with Emirates in the clear

Air New Zealand (ANZ) has strongly denied a report emanating from Australia that ANZ colluded with Emirates on fixing cargo rates between Australia and New Zealand.

A Fairfax Media report, citing court documents presented by the Australian Competition and Consumer Commission which is investigating Emirates, alleged that ANZ deputy CEO Norm Thompson and Emirates SkyCargo senior VP Ram Menen discussed prices to be charged in October 2003.

In a letter to staff, ANZ CEO Rob Fyfe has now clarified that discussions that began in September 2003 related to ANZ's interest in securing additional lift across the Tasman Sea because it was replacing B767-300s with A320s and needed more capacity.

"This was going to create a serious shortage of Air NZ cargo capacity as we replaced wide-body aircraft. At about the same time, Emirates had just entered the Tasman market bringing massive overcapacity of passenger and cargo services [with B777s and A340s], making them a logical source of extra wide-body capacity," Fyfe said in his communication.

"This was the context of Norm's [Thompson] discussions with Emirates, which after some negotiation resulted in a cargo Special Pro-rate Agreement; a very standard and entirely legal agreement in the airline industry. It records wholesale rates airlines will charge to each other. It does not reflect any agreement on prices to be charged to cargo customers."

The Australian Competition and Consumer Commission has filed proceedings against Emirates, saying the Gulf-based carrier fixed cargo prices and forged an illegal agreement with ANZ.