Antitrust Law Daily Wrap Up, ANTITRUST NEWS: Two Japanese Air Freight Forwarding Companies Agree to Pay $18.9 Million for Conspiring to Fix Prices, (Mar 8, 2013)

By Jeffrey May, J.D.

The Department of Justice Antitrust Division today announced charges against two Japanese companies for their roles in a conspiracy to fix fuel surcharges and security fees in connection with their provision of air freight forwarding services for air cargo shipments from Japan to the United States. The companies have agreed to plead guilty and to pay criminal fines totaling $18.9 million. “K” Line Logistics Ltd. agreed to pay a $3,507,246 criminal fine, and Yusen Logistics Co. Ltd. agreed to pay a $15,428,207 criminal fine, according to the Justice Department.

In announcing the charges, Bill Baer, Assistant Attorney General in charge of the Department of Justice Antitrust Division, said that “[p]rosecuting these kinds of global, price-fixing conspiracies continues to be a top priority of the Antitrust Division.”

Separate charges were filed against the companies in the federal district court in Washington, D.C. on March 8. According to charges, “K” Line Logistics and Yusen Logistics conspired to fix certain freight forwarding service fees, including fuel surcharges and various security fees, charged to customers for services provided in connection with air freight forwarding shipments of cargo shipped by air from Japan to the United States from about September 2002 until at least November 2007. The companies purportedly held meetings and discussions to monitor and enforce adherence to the agreed-upon freight forwarding service fees.

Freight forwarders manage the domestic and international delivery of cargo for customers by receiving, packaging, preparing and warehousing cargo freight, arranging for cargo shipment through transportation providers such as air carriers, preparing shipment documentation and providing related ancillary services. According to the Justice Department, including these most recent charges, 16 companies have either pleaded guilty or agreed to plead guilty and have agreed to pay criminal fines totaling more than $120 million, as a result of the government’s investigation.

Last year, Japanese freight forwarding company Yamato Global Logistics Japan Co. Ltd. agreed to plead guilty and to pay a $2.3 million criminal fine for its role in the conspiracy. Most of the air freight forwarding companies identified by the government as participating in the challenged conduct were charged in 2010 and 2011.

In a March 8 statement, Yusen Logistics said that the company “treats this incident with the utmost seriousness” and “has been taking steps to strengthen and improve its compliance structure.” The company said that it had been under investigation since January 2008.

News: Antitrust AntitrustDivisionNews