####    TOO  BIG  TO  BE  FINED    ? ? ? ?

WHY  NOT  JAIL TERM  &  DEATH  SENTENCE    ? ? ? ?

This  is  INFLATIONARY  ROBBERY    ? ? ? ?

EFFECT   Is  WORSE  than  QE 2    ? ? ? ?

SINGAPORE

Singapore Airlines (SIA) Cargo yesterday became the 20th airline to be charged in a massive ongoing global investigation into air cargo price-fixing.

But the latest development does not spell the end of SIA Cargo’s legal woes — in fact, analysts who spoke to MediaCorp believe it could adversely impact the company’s appeal against a €74.8-million ($129-million) fine slapped against it by the European Union’s competition regulator for similar charges.

If SIA pays the fine imposed by the EU as well, its total bill could come to some $192 million.

The EU is separately taking action against 11 air cargo carriers for price fixing [?  sounds like gangsterism  ? ? ? ?] — some of which, including SIA Cargo, Cathay Pacific, SAS Cargo and Air France-KLM Group, are also involved in the US investigations.

The US authorities had filed a felony charge against SIA Cargo in a federal court accusing the company of engaging “in a conspiracy to fix the cargo rates” for a four-year period starting from February 2002.

In a statement, SIA Cargo said it cooperated with the investigation by the US authorities. The company added that it decided to accept the plea offer “after consulting its legal advisors and carefully weighing its options”.

It will set aside $61.92 million for the current financial year as provision for the antitrust fine that it has agreed to pay the US Justice Department.

Adding that the quantum of the fine “isn’t too damaging”, Standard & Poor’s Singapore-based editorial director Yusof Shukor pointed out that the provision meant that it will have “no major impact” on SIA Cargo’s bottom-line.

Yesterday, SIA shares posted their largest one-day gain since Sept 1, rising 2.7 per cent to $15.84.

In a note to its clients, DMG Research said it was not changing its earnings estimates for SIA “as we consider these provisions as exceptional items”.

However, the research house added that SIA’s “agreeing to pay the fine appears to be an indirect admission of guilt to the price-fixing charges and may have an knock-on impact” on its appeal against the fine imposed by the European Commission.

In a press release, the US Department of Justice said yesterday SIA Cargo had faced a maximum fine of US$100 million, which “may be increased to twice the gain derived from the crime or twice the loss suffered by the victims of the crime, if either of those amounts is greater than the statutory maximum fine”.

To date, the US authorities have collected US$1.7 billion in criminal fines against the carriers found guilty. British Airways and Korean Air each reportedly paid US$300 million in criminal fines in 2007, while Air France-KLM Group agreed to a US$87 million US civil antitrust claims settlement earlier this year. In September, China Airlines accepted a plea offer and paid US$40 million.