Management of flag carrier Garuda Indonesia (GIAA) assessed the Australian federal court’s decision to order state-owned flight carrier to pay penalties of US$13.2 million (Rp189 billion) for colluding on fees and surcharges for air freight services as unfair and has a legal loophole to appeal.
The penalties follow the Australian Competition and Consumer Commission’s (ACCC) court action against a global air cargo cartel, which has so far resulted in penalties of A$132.5 million against 14 airlines, including Air New Zealand, Qantas, Singapore Airlines and Cathay Pacific.
The Court found that between 2003 and 2006, Garuda made and gave effect to agreements that fixed the price of security and fuel surcharges, as well as a customs fee from Indonesia. It was ordered to pay A$15 million. A further A$4 million was ordered for the imposition and level of insurance and fuel surcharges from Hong Kong, ACCC said in a statement.
Responding to this, Garuda’ VP Corporate Secretary Ikhsan Rosan explained that the incident was an old case and had not yet been legally binding, so there was still a legal loophole that made it possible to appeal.
“We consider that this case is unfair and Garuda Indonesia has never carried out this practice in its business, and this accusation is inappropriate,” he said.