OFT halves BA price fixing fine

OFT halves BA price fixing fine

British Airways was today ordered to pay a reduced fine of £58.5 million by the Office of Fair Trading in the conclusion of a long-running price fixing case with Virgin Atlantic.

The OFT ruled that the rival carriers engaged in anti-competitive practices over passenger fuel surcharge pricing.

Virgin has escaped being fined as it blew the whistle on BA

The £58.5 million fine imposed on BA is a reduction from the £121.5 million level originally agreed in August 2007.

The fine was reassessed following the issue of a statement of objections in November “in light of a number of factors,” the OFT said.

These included legal developments regarding penalty setting for competition law infringements and the fact that the overall value added to the OFT's investigation by BA's co-operation was greater than had been anticipated at the time of the original agreement.

The OFT concluded that BA and Virgin co-ordinated their surcharge pricing on long-haul flights to and from the UK through the exchange of pricing and other commercially sensitive information between August 2004 and January 2006.

OFT cartels and criminal enforcement senior director Ali Nikpay said: “This decision brings an end to this investigation and sends out a strong message that co-ordinating pricing through the exchange of confidential information between competitors is unlawful.

“The size of the fine underlines that it is important for companies to take steps to ensure that they have an effective compliance culture.

“The fine would have been higher still but for the co-operation provided by BA throughout the OFT's investigation.

“Without this, together with BA's admission of the infringement, the case would have taken considerably longer to resolve.”


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