DHL Expects Immunity in Price Fixing Investigation

Deutsche Post expects its DHL forwarding business to be granted immunity from prosecution and fines by Singapore antitrust authorities, who are investigating 11 companies for alleged price fixing, the German logistics company said.

 

The Competition Commission of Singapore (CCS) said this month it was investigating 11 freight forwarding companies, including Deutsche Post unit DHL Global Forwarding, for alleged price-fixing of air freight forwarding services.
 

Deutsche Post told Reuters last week that the probe related to pricing and surcharges in the forwarding industry from 2002 to 2007.
 

Forwarders buy cargo space from airlines, shippers and truckers and bundle shipments for customers, such as carmakers, high-tech firms and agriculture firms. They also offer warehousing, warranty processing, returns management as well as customs and insurance brokerage.

"DHL Global Forwarding will be granted immunity from prosecution and fines by the CCS as a result of its cooperation with the CCS under its leniency program," Deutsche Post said.

Announcing the investigation on its website, CCS said the 11 companies include Deutsche Post's DHL Global Forwarding units in Japan and Singapore, Hankyo Hanshin Express, K Line Logistics, MOL Logistics, Kintetsu World Express Inc, Nippon Express Co, Nishi-Nippon Railroad Co, Nissin Corporation, Vantec Corporation, Yamato Holdings Co and Yusen Logistics Co.

CCS cited evidence showing the companies had attended meetings in Japan at which they exchanged information and agreed certain fees and surcharges on air freight forwarding for shipments from Japan to other countries, including Singapore.

The watchdog said it launched the investigation after receiving an application for immunity from one of the parties involved in the alleged cartel. It did not identify the company.

K Line Logistics said it was notified by CCS about infringing Singapore competition law, was taking the matter seriously and would work to improve compliance management.

Representatives of Hankyo Hanshin Express Co Ltd, Nippon Express, Nishi-Nippon Railroad, Yusen Logistics and Vantec Corporation said they were looking into the matter.

Kintetsu World Express, MOL Logistics and Yamato Holdings declined to comment, while Nissin Corporation was not immediately available for comment.
 

Deutsche Post's air freight forwarding business is the biggest in the world in terms of export freight tonnes. It competes with Kuehne & Nagel and Panalpina of Switzerland and with Schenker, a unit of German state-owned railway Deutsche Bahn.

Deutsche Post derives about three quarters of its sales from its DHL logistics units that offer express international courier services, global forwarding and supply chain logistics. It said its mail, express and supply chain divisions were not a subject of Singapore's investigation.

The company said it would will continue to strengthen its internal compliance procedures across the business.

(Reporting by Marilyn Gerlach and Harro ten Wolde; additional Reporting by Osamu Tsukimori and James Topham in Tokyo and Rachel Armstrong in Singapore; editing by David Holmes and Tom Pfeiffer)