Singapore Airlines 2012 Annual Report Download - page 171

169ANNUAL REPORT 2011/2012
Notes to the Financial Statements
31 March 2012
36 Contingent Liabilities (in $ million) (continued)
(b) Cargo: Investigations by Competition Authorities and Civil Class Actions (continued)
Apart from Canada and South Korea, the filed cases still 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 provision in the financial statements for the
other pending investigations, court proceedings, civil suits, or threatened claims.
(c) Passengers: Civil Class Actions, South African settlement and Indian case
The Company and several other airlines have been named in civil class action lawsuits in the US and Canada alleging
an unlawful agreement to fix surcharges and fares on transpacific flights. These cases are currently in the procedural
stages and none has been tried thus far on their respective substantive legal merits. As these lawsuits have neither
been tried nor the alleged damages quantified, it is premature to make a provision in the financial statements.
With regard to an investigation conducted by the South African Competition Commission concerning price-fixing on
certain routes, a settlement agreement has been reached which includes an administrative penalty of $4.1 million.
The payment of the settlement agreement is pending the final approval of the South African Competition Tribunal.
In July 2010, the Company received notice of an investigation by the Competition Commission of India (“CCI”)
concerning alleged collusion in the elimination of commissions paid to travel agents in India. In January 2011, the
Office of the Director General of the CCI issued a report exonerating the Company and the other defendant airlines.
The Travel Agent Association of India has filed an appeal of the CCI’s decision with the Competition Appellate Tribunal
(“COMPAT”). The Company has filed a reply brief with the COMPAT. As this appeal has not been decided nor the
alleged damages quantified, it is premature to make a provision in the financial statements.
(d) Australian Travel Agents’ Representative Actions
A former Australian travel agent, Leonie’s Travel Pty Limited, filed a representative action in the Federal Court of
Australia (New South Wales District Registry) on 15 December 2006 against 6 airlines, namely Qantas Airways
Limited, British Airways plc, Air New Zealand Limited, Malaysian Airline System Berhad, Cathay Pacific Airways
Limited (“CX”) and Singapore Airlines Limited, in a claim on behalf of Australian travel agents for alleged non-
payment of commissions on fuel surcharges applied to passenger tickets issued in Australia from May 2004 onwards
(the “Leonie’s Case”).
In May 2007, the applicant’s solicitors filed a fresh similar representative application on behalf of Paxtours International
Travel Pty Ltd, another Australian travel agent, against CX and the Company, as Leonie’s Travel did not issue fares
against CX and the Company (the “Paxtours Case”).
On 19 August 2011, the Leonie’s Case was discontinued against the Company.
The Paxtours Case remains the vehicle for claims against the Company. Following discussion with Paxtours’ solicitors,
the parties have agreed on a settlement mechanism, which has been approved by the court. Based on presently
available information, the Company does not expect the settlement amount to be material.