Class Action in regard to Air Freight Surcharge Pricing
Dear,
There have been various inquiries in relation to 'class actions' for alleged collusion in the pricing of airfreight surcharges.
Melbourne based law firm: Maurice Blackburn Cashman have lodged a lawsuit in the Federal Court of Australia and the chairman of AFIF's opinion is as follows;
'Class Action' is a legal proceeding allowing the claims of many individuals against the same defendant, arising out of the same or similar circumstances, to be conducted by a single representative.
It is to be noted that the English jurisdiction has taken a more restrictive approach to the device of class action compared to the US.
The Issue:
Indexed Surcharges, in particular Fuel Surcharges, introduced by Airlines in response to increased fuel prices over many years, have been under the scrutiny of the regulators in North America, Europe and in Australia by the ACCC.
This topic may have appeared to be low profile to the public, but this was certainly not the case. The Australian Regulator, Airlines and Industry had participated in the ongoing inquiry and the largest segment of the air freight business in Australia identifiably followed free market principals.
The inquiries overseas, mainly in North America and in Europe, followed dynamics specific to those markets. The action of a European Airline to seek immunity from the US regulator by means of a substantial payment to the US authority for immunity from that US authority, took the issue into the public focus.
Due consideration should be given to the fact that airlines faced higher fuel costs which could not be met with the status quo on pricing through increased productivity. To highlight the difficulties in practical terms, efficiency of engines could not keep up with the fuel price increases.
Our Industry is of the opinion that the question as to what degree airlines in Australia could have addressed the difficulties differently, ought to be the judgment of the regulator, the ACCC.
AFIF are in no position to advise members specifically and will continue to give advice in the ACCC's inquiries.
We advise however that individual member companies should take independent legal advice in relation to the class action and in particular regard to their status as aircargo 'agent' or whether contracting as 'principal', in relation to the application of fuel and other surcharges to their air freight rates.
Class action requires, amongst other provisions, that the action is restricted to parties who believe that they were directly disadvantaged.
It would appear to be self-evident that any forwarder contracting as principal would therefore be excluded from participation and so apparently would be any freight forwarder acting as agent.
Brian Lovell
Chief Executive Officer
Australian Federation of International Forwarders Ltd (AFIF)
Suite 403, Level 3
152 Bunnerong Road
Eastgardens
NSW 2036
Tel: (61 2) 9314 3055
Fax: (61 2) 9314 3116