El Al sued for price fixing

El Al, Lufthansa, Swiss, and British Airways have been sued in Israel for the first time for allegedly price fixing on cargo consignments.

For the first time in Israel, an antitrust organization has filed a NIS 613 million lawsuit against El Al Israel Airlines Ltd. (TASE: ELAL), British Airways plc, Lufthansa AG (DAX: LHA), and Swiss International Air Lines AG with the Central District Court, and asked it to recognize the lawsuit as a class action suit. Hatzlaha Consumer Movement for Promoting a Fair Social Economy accuses the airlines of price fixing on cargo. Foreign antitrust agencies uncovered the scheme in February 2006.

Hatzlaha contends that the airlines illegally fixed prices by adding charges, such as extra fuel and security fees, to the basic price for cargo consignments. The price fixing took place in 2000-06, at least, and included meetings by executives from the airlines which were party to the cartel.

Since the scheme was discovered, the participating airlines have been in court proceedings in various countries, but to date no claim has been filed in Israel in the matter. Hatzlaha filed the lawsuit just before the statute of limitations would come into effect.

Hatzlaha appended to the statement of claim an economic opinion by Hanan Sharon, which states that the respondents' illegal acts caused the claimants serious damage.

Hatzlaha board member Ben-Zion Tzitrin said, "We attach great importance to the taking of active measures to protect victims and promote private citizen enforcement in the areas of antitrust and competition."

Hatzlaha legal counsel Ad. Elad Man said, "This appears to be a clear case which requires suitable civil enforcement action on the basis of appropriate professional knowledge and analysis in areas where there is deprivation and a lack of clear class-action procedures due to various barriers."

In September, 2012 Hatzaha was the first organization to secure recognition of a class action suit by the Israel Securities Authority in a securities and capital market case.

Published by Globes [online], Israel business news - www.globes-online.com - on February 7, 2013

© Copyright of Globes Publisher Itonut (1983) Ltd. 2013

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