News and Press
British Airways executives plead not guilty to price-fixing conspiracy

On 13 July 2009, at a hearing at Southwark Crown Court, three former BA executives pleaded not guilty to price-fixing offences between BA and Virgin.

The three are accused of having dishonestly agreed with Virgin representatives to make or implement arrangements which directly or indirectly fixed the price of fuel surcharges on long haul flights between July 2004 and April 2006. Their trial is due to begin in January 2010 and each faces unlimited fines and/or up to five years in prison. In 2007, BA was fined £271.5 million by the UK and US competition authorities.

On the same day, Steve Ridgway, Chief Executive of Virgin Airways Limited, publicly acknowledged his involvement in illegal cartel activities arising from the same arrangements, saying in a statement released by Virgin:

"I apologise unreservedly for my involvement in this case. I have fully co-operated with the competition authorities since their inquiries began in 2006. Although I did not have any direct contact with BA in relation to passenger fuel surcharges I regret that, on becoming aware of the discussions, I did not take steps to stop them."

In return for their co-operation Mr Ridgway, and a number of his colleagues at Virgin, escaped prosecution under an immunity agreement with the competition authorities. Under the same arrangements Virgin escaped without having to pay a fine.

Mr Ridgway goes on to confirm that Virgin has since implemented a 'Competition Law Compliance Programme'.

Nicola Kingaby, associate in TLT's Competition team comments:

"In certain circumstances, the competition authorities can offer immunity to individuals and businesses that come forward with information about price-fixing (or other cartel behaviour, such as limiting production or supply, dividing customers and/or territories or co-ordinating bids made in response to a tender) that they are involved in. Immunity from fines (and in some cases from individual sanctions) may be total or partial depending on when the business (or individual) comes forward.

The risk of an infringement of competition law can be reduced, as Virgin has recognised, by implementing a 'Competition Law Compliance Programme' tailored to reflect the particular risks faced by a business. A compliance programme should also include a review of business practices so that past (or ongoing) breaches may be brought to an end and a claim for immunity from prosecution considered."

TLT offers bespoke compliance programmes with optional elements, each priced separately. For further information please contact Nicola Kingaby.