US jury indicts ex-Japanese airline bosses for price-fixing


WASHINGTON–A U.S. federal grand jury indicted three former Japanese airline executives Tuesday on charges of fixing rates for air cargo shipments to and from the United States. The indictment was the latest development in a U.S. probe that has now ensnared 19 airlines from around the globe and 17 executives. Takao Fukuchi, a former president of JAL’s cargo sales division, and Yoshio Kunugi and Naoshige Makino, both ex-senior executives of Nippon Cargo Airlines, played a “pivotal role” in setting cargo shipment rates and conspired to “suppress and eliminate competition,” the indictment said. They each face up to 10 years behind bars and at least US$1 million in fines if found guilty. The maximum fine may be increased to twice the gain they derived from their crime or twice the loss suffered by their victims — if either one of those amounts exceeds that of the standard maximum fine. Both airlines had several branch offices in the United States. The accusations center on the late 1990s and early 2000s, when industry participants are accused of agreeing to fix cargo rates on scheduled flights. Air France, All Nippon Airways (ANA), British Airways, Cathay Pacific, Taiwan’s China Airlines, Northwest Airlines, Qantas Airways and SAS Cargo Airlines are among the airlines accused. More than US$1.7 billion in fines have been imposed as a result of the industry-wide investigation and four executives have been sent to prison. Charges are now pending against 13 others. Early this month, Japan’s ANA agreed to plead guilty in the United States to two charges of price fixing and to pay a US$73 million fine. The carrier has been accused of holding meetings and discussions to fix cargo rates and some unpublished passenger fares between 2000 and 2006. According to the indictment returned in U.S. District Court in Atlanta, Georgia, Fukuchi and Kunugi are charged with entering into and participating in the conspiracy from at least as early as December 1999 until at least February 2006. Makino is charged with joining and participating in the conspiracy from at least as early as June 2001 until at leas February 2006. The trio and their co-conspirators are alleged to have met, talked about, communicated and fixed cargo rates and coordinated the timing of the rate changes.

They allegedly implemented collusive cargo rates according to their own agreements and accepted payments for shipments at collusive, non-competitive rates. Air cargo carriers transport heavy equipment, consumer goods, perishable commodities and other cargo on scheduled international flights.