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European Court annuls price-fixing case against Air Canada, other carriers

MONTREAL — A European Court has overturned a ruling against Air Canada and several other carriers that were fined about US$1.1 billion several years ago for allegedly fixing prices on international cargo shipments.

The General Court of the European Union issued its decision Wednesday to annul a November 2010 ruling by the European Commission.

Eleven carriers were fined for infringing European competition law by co-ordinating to set cargo fuel and security surcharges between 1999 and 2006.

Air Canada (TSX:AC), which was initially fined 21 million euros or about US$20 million, welcomed the ruling.

"We have always maintained that the decision was ill-founded and the General Court's ruling confirms Air Canada's position," spokeswoman Isabelle Arthur wrote in an email.

The court found the EU's original decision was contradictory because it considered four distinct cartel infringements but based its decision on one continuous period of wrongdoing.

"Although the grounds of the contested decision describe a single and continuous infringement in relation to all of the routes covered by the cartel, they nevertheless contain significant internal inconsistencies," the judges said.

Air France-KLM had received the heaviest penalty, 310.1 million euros of the 799.4 million euros in fines levied against all 11 airlines.

The court ordered the European Commission to pay Air Canada's costs.

The country's largest airline had escaped similar charges in Canada and the U.S.

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Ross Marowits, The Canadian Press

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