An airline company has pleaded guilty to failing to supply information requested by the Commerce Commission under section 98 of the Commerce Act. It has been fined $11,000 in the Auckland District Court.

In 2007 Aerolineas Argentinas S. A. failed to provide documents to the Commission in response to a notice issued under section 98 of the Commerce Act. This constituted a breach of section 103 of the Act and is a criminal offence. The notice was issued in connection with the Commission's investigation into allegations of cartel conduct in the air cargo services market. The notice required Aerolineas Argentinas to supply the requested information by mid November 2007. The documents were eventually provided to the Commission in mid April 2008.

"This fine from the Courts reinforces that businesses must ensure that they respond to the Commerce Commission's section 98 notices on time and fully," said Paula Rebstock, Commerce Commission Chair. "Statutory notices are an effective tool and the Commission relies heavily on them to gain evidence from parties under investigation," Said Ms Rebstock.

As the Commission's prosecution of the alleged international air cargo cartel is still before the Courts, there will be no further comment on that case. Aerolineas Argentinas is not being prosecuted as part of that action.

Background

In July 2008, the Commission announced that it was filing criminal charges against Cathay Pacific Airways Ltd and Singapore Airlines Cargo Pte Ltd for non-compliance with section 98. The proceedings are ongoing and there will be no further comment on these cases.

Penalties for breaching section 103 of the Commerce Act are summary conviction and fines of up to $30,000 for companies.

Statutory notices require companies or individuals to provide information to the Commission within a reasonable but specific period of time. The information requested must be provided even if it implicates the provider in a breach of the Commerce Act. The information obtained through the use of notices helps the Commission to assess in a timely manner whether a company or individual has breached the Commerce Act.

Previous criminal prosecutions for non compliance with Commerce Act statutory notices. In June 2005, the Commission obtained convictions against Koppers Arch (NZ) Limited and its former General Manager under section 103 of the Commerce Act for deliberately withholding relevant documents that the Commission had requested through statutory notices in the wood preservative chemicals cartel investigation. Koppers Arch was fined $25,000. In August 2006, as part of the same cartel investigation, the Commission obtained a conviction against Osmose New Zealand Limited for failing to provide documents that had been requested by the Commission through a statutory notice and the former Osmose Australasian Group General Manager for providing misleading and deceptive information in an interview. Osmose was fined $13,000. The former General Manager was fined $7,000.