K+N last ‘gardener’ in NZ cartel club to be fined

The High Court in Auckland has ordered Swiss company Kuehne + Nagel (K+N) International to pay a penalty of NZ$3.1 million (US$2.7 million) plus costs for breaches of the Commerce Act and brings the total penalties in this case to $11.95 million.


K+N last ‘gardener’ in NZ cartel club to be fined


The High Court in Auckland has ordered Swiss company Kuehne + Nagel (K+N) International to pay a penalty of NZ$3.1 million (US$2.7 million) plus costs for breaches of the Commerce Act and brings the total penalties in this case to $11.95 million. K+N is the last defendant in a long-standing case brought by the Commerce Commission against six international freight forwarding companies for a range of cartel behaviour.

The other five defendants admitted their role in the cartel and paid penalties in 2010 and 2011 while K+N on the other hand challenged the Commission’s jurisdiction, but were unsuccessful in both the High Court and Court of Appeal.

In 2007, the Commission began investigating alleged collusion by a number of multi-national companies involved in the supply of international freight forwarding services to the New Zealand market. This followed a confidential application for leniency by one of the companies involved in the conduct. In 2010, the Commission filed proceedings against six companies: Deutsche Bahn, Bax Global, Kuehne + Nagel, Panalpina, EGL and Geologistics, for the alleged collusion on surcharges imposed to cover the costs of complying with security measures required by airlines and national authorities K+N and the other five other companies were part of a secret cartel that called itself the ‘Gardening Club’ with the cartel participants agreeing that they would each pass on certain costs to customers, rather than compete in the usual way and determine their own pricing structures and price levels.