On 19 April 2012 the Office of Fair Trading ("OFT") said that it had fined British Airways £58.5 million, in a decision which would bring its investigation into price fixing in relation to fuel surcharges to a conclusion.
Collusion with Virgin Atlantic
The case against British Airways related to its collusion with rival Virgin Atlantic in pricing surcharges on long-haul flights. In an original decision in August 2007, British Airways had agreed to pay a fine of £121.5 million for anti-competitive practices that took place between 2004 and early 2006. This would have been the largest civil fine ever imposed by the OFT. Virgin was not required to pay a fine because it reported the case to the watchdog in the first place.
The OFT said that the reduced penalty announced on Thursday reflected recent case law in calculating fines and the level of cooperation shown by British Airways since 2007 in particular.
Whistleblowers protected from liability
This case is a good example of how whistleblowers can avoid liability for cartel behaviour. As the whistleblower, Virgin Atlantic gained immunity from prosecution and escaped the massive fines that British Airways incurred. However, to guarantee its immunity, Virgin had to produce sufficient evidence for the OFT to bring a criminal trial – as well as field the prosecution's three key witnesses, including Steve Ridgway, the chief executive of Branson's airline.
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