Yet More Freight Forwarders Caught Up In EU Probe

EUROPE – Yesterday’s reports that some of the giants of the freight forwarding industry such as DHL, Panalpina and Kuehne+Nagel had received Statements of Objection from the EU Commission’s anti competition watchdog concerning airfreight surcharge practices has today been followed by the news that DSV, UPS and Expeditors International have also been added to the list of alleged violators.

Though all these companies deny any deliberate wrong doing the obvious conclusion is that the EU is suspicious that these companies have been cooperating on pricing strategies to effectively create a cartel, a violation of European law.

Danish-based DSV said the issue related to a period between March 2003 and August 2004 and was undertaken by the French firm ABX Logistics which was subsequently taken over by DSV in 2008 and is now their French branch. They point out that the Statement does not relate to any other part of the DSV group.

US-based Expeditors International state that the complaints against them relate to airfreight trade lanes between South China/Hong Kong and the European Economic Area between August 2005 to June 2006. The company says in a statement that it “…intends to vigorously defend itself against the allegations.”

UPS simply confirmed that they had received the Statement and would review it.

FedEx, UPS’ great rival, has pointed out that they have not been subject to opprobrium from the Commission.

The Statement of Objections is a formal step in European antitrust investigations. After receiving such statements, companies have two months to defend themselves in writing. They can also ask the Commission to hear their case at an oral hearing which usually takes place about one month after the written reply has been received.

After having heard the company's defence the Commission takes a final decision on whether European law has been broken, which may be accompanied by fines of up to ten per cent of a company’s worldwide annual turnover.