Panalpina World Transport (Holding) Ltd. today confirmed that the European Commission has fined Panalpina along with a number of other major freight forwarding companies for antitrust violations related to isolated air freight surcharges for certain European trade lanes. The penalty notice to the industry concerns an exchange of information during very limited periods of time prior to 2008.
Panalpina will analyze the Commission’s decision given its right to appeal the decision to the European General Court. The Group has so far made no provision for the penalty of EUR 46.5 million as it was not in a position to predict the outcome of this proceeding and to assess its financial exposure.
It is Panalpina’s position, which is supported by independent economic evidence, that the infringements likely did not affect prices paid by Panalpina’s customers.
In November 2011, a U.S. court approved Panalpina’s settlement with the US Department of Justice Antitrust Division. The settlements closed investigations related to the same air freight surcharges in relation to U.S. trade lanes. In 2011, Panalpina also completed settlement negotiations with the New Zealand Commerce Commission and the agreed penalty was approved by the competent court. Identical antitrust proceedings in Canada and Australia were dropped.
Two antitrust proceedings are still ongoing in Switzerland and Brazil. They are also part of the coordinated investigation of several competition authorities against various freight forwarding companies. In Switzerland Panalpina has signed a settlement agreement which is still subject to the formal approval of the Swiss Competition Commission and has booked a related provision of CHF 3.2 million.
In the past years, Panalpina has successfully built a state-of-the-art compliance structure aimed at ensuring rigorous adherence to competition and other pertinent laws throughout the world. Based on its Code of Conduct, the company is providing both in-person and online training to its employees on a global basis. The company’s Ethics and Compliance Department is staffed with dedicated personnel stationed throughout the world.