Recently, the US Justice Department said that Air France-KLM and three other airlines have consented to pay fines amounting USD$504 million for settling US price-fixing charges involving huge shipments of consumer goods from electronics to medicines. Notably, the plea deal occurs as the latest among a number of cargo price-fixing settlements that has highly boosted the total fines from the US antitrust investigation to a record value of USD$1.27 billion.

As per the new agreement, Air France-KLM is required to pay USD$350 million. Interestingly, this is the second-largest criminal fine ever charged by the Justice Department's antitrust division. This was confirmed by the statement made by the government. Until the start of the price fixing investigation in May 2004, Air France and KLM functioned as separate companies after which they combined into a single company when they combined under a single holding company.

According to the Department of Justice, Cathay Pacific is to pay a USD$60 million fine while Scandinavian airline SAS is required to pay USD$52 million and Martinair USD$42 million.

The government observed in a statement, "The airlines each engaged in a conspiracy to suppress and eliminate competition by fixing the cargo rates charged to customers for international air shipments. The charged conduct affected billions of dollars of consumer and other goods -- including produce, clothing, electronics and medicines -- shipped by these airlines and their competitors in the air cargo industry."

Air France Chief Executive Jean-Cyril Spinetta said, "We have taken thorough steps across the organization to prevent recurrence, as Air France is committed to the highest standards of Corporate Governance."