Singapore Airlines 2015 Annual Report Download - page 187

36 Contingent Liabilities (in $ million) (continued)
(a) Cargo: Investigations by Competition Authorities and Civil Class Actions (continued)
In December 2012, SIA Cargo confirmed its acceptance of settlement agreements with the Australian Competition and
Consumer Commission and the New Zealand Commerce Commission, bringing to an end civil penalty proceedings
concerning the air cargo issues which had been initiated in 2008. SIA Cargo agreed to pay a penalty and costs amount
of AUD12.2 million ($15.5 million) in Australia. In New Zealand, SIA Cargo agreed to pay a penalty and costs amount of
NZD4.4 million ($4.4 million). SIA Cargo paid these amounts in December 2012 and January 2013 in accordance with
Australian and New Zealand laws respectively. The total Australian and New Zealand settlement amount of $19.9 million
has been reflected in the exceptional items of the Group’s accounts in FY2012/13.
In January 2014, the Swiss Competition Commission announced a fine against SIA Cargo and the Company of
CHF1.7 million ($2.3 million) in respect of the air cargo issues. This amount has been reflected as exceptional items in
the Group’s accounts in FY2013/14. SIA Cargo and the Company have filed an appeal to the Swiss Federal Administrative
Tribunal seeking annulment of the decision.
Aer the investigations commenced, civil damage lawsuits were filed in the United States, Canada, Australia, South Korea,
England, the Netherlands, Norway and Germany by private parties against several airlines, including SIA Cargo and the
Company. Other lawsuits have been threatened by customers of SIA Cargo or shippers that purportedly contracted with
SIA Cargo’s customers.
The plaintis in the South Korea proceedings withdrew their complaint in July 2011 and the proceedings were accordingly
dismissed without prejudice. In January 2014, a shipper from South Korea which purportedly contracted with SIA Cargo’s
customers served a claim against SIA Cargo and other airlines. SIA Cargo is defending this proceeding.
In June 2011, without admitting any liability, SIA Cargo and the Company reached a settlement with the plaintis in Canada
whereby SIA Cargo agreed to pay CAD1.05 million ($1.3 million) to resolve all liability of SIA Cargo and the Company as
concerns the civil damage lawsuits filed in Canada. This amount has been reflected as an exceptional item in the Group’s
accounts in FY2011/12.
In December 2013, without admitting any liability, SIA Cargo and the Company reached a settlement with the class action
plaintis in the United States whereby SIA Cargo agreed to pay USD62.8 million ($78.3 million) to resolve all liability of SIA
Cargo and the Company as concerns the air cargo class action lawsuits filed in the United States. This amount has been
paid and is reflected as an exceptional item in the Group’s accounts in FY2013/14.
In March 2014, without admitting any liability, SIA Cargo and the Company reached a settlement with the class action
plaintis in Australia whereby SIA Cargo agreed to pay AUD5.6 million ($6.4 million) to resolve all liability of SIA Cargo
and the Company as concerns the class action lawsuit filed in Australia. This amount has been paid and is reflected as an
exceptional item in the Group’s accounts in FY2013/14.
In addition, without admitting any liability, in 2012, 2013 and 2015, SIA Cargo reached settlements with certain of its
customers to resolve all pending and potential future civil damage claims regarding the air cargo issues. The settlements
in 2012 and 2013 have been reflected in the Group’s accounts in the previous financial years. Arising from the latest
settlement in March 2015, a provision of USD10.1 million ($13.7 million) was made as an exceptional item in the Group’s
accounts. The individual terms of all such settlements are required to be kept confidential.
Apart from Canada, the United States and Australia, the filed cases remain in their respective procedural stages and none
have been tried thus far on their respective substantive legal merits.
Apart from the exceptional items noted above, it is premature to make a provision in the financial statements for the other
pending investigations, court proceedings, civil suits, or threatened claims as the outcome is uncertain.
Singapore Airlines | Annual Report FY2014/15 |185