Australian Competition and Consumer Commission v Korean Air Lines Co Ltd

The Australian Competition and Consumer Commission (ACCC) brought proceedings against Korean Air Lines Co Ltd (Korean Air) for contravening section 45 of the Trade Practices Act 1974 (Cth). Korean Air admitted to contravening the Act by entering into agreements with its competitors to fix fuel surcharges, security surcharges, and a customs fee for the carriage of air cargo from Indonesia. The primary issue for the court was to decide on the appropriate pecuniary penalty and other orders to impose on Korean Air. The court found that the penalty proposed by the parties, amounting to $5.5 million, was appropriate given the gravity of the contravention and the need for specific and general deterrence.

The court considered several factors in determining the appropriate penalty. It acknowledged the importance of deterring similar conduct in the future and noted that the penalty should not be oppressive. The court was satisfied that the penalty proposed by the parties was within the permissible range and that the likelihood of oppression was slight. The court also noted the public interest in the resolution of trade practices litigation and the need to ensure that the penalty served its purpose without being excessive.

The court concluded that the proposed penalty and other orders were appropriate and ordered Korean Air to pay a pecuniary penalty of $5.5 million, along with other specified orders including injunctions preventing future price-fixing arrangements and a contribution towards the ACCC's costs. The court's decision underscores the importance of upholding competition laws and deterring anti-competitive practices in the aviation industry.