Global




Major Airlines Contest Nigerian Decision
Competition, Consumer Protection

Reuters reports that the Nigerian Civil Aviation Authority (NCAA) has fined British Airways US$135 million and Virgin Atlantic Airways (Virgin) US$100 million, charging that the two companies engaged in price fixing and manipulating the airline market. Flights from the new major airlines and Nigeria’s main airline Arik Air reportedly continue to fly between Nigeria and the UK, despite the NCAA’s earlier threats to reduce British Airway flights after London Heathrow stopped Arik Air flights from Abuja. According to Reuters, the Nigerian Government has contended that “Arik Air should not have to pay high costs to land at Heathrow when Lagos airport doesn’t charge those fees [to UK airlines]“. British authorities have reportedly stated that they cannot control how the privately owned airlines and airports manage fees. British Airways and Virgin have contested the fines, reports Reuters.
Reuters: Nigeria fines BA, Virgin Atlantic total $235 mln (18 November 2011)

Related news item:
The Nation: NCAA, British Airways, Virgin Atlantic bicker over indicting report (21 November 2011)
(Source: Reuters; The Nation)


Pfizer Plans to Settle Anti-Bribery Claims
Anti-Bribery and Anti-Corruption, Business Ethics and Corporate Culture

The Wall Street Journal (WSJ) reports that pharmaceutical giant Pfizer plans to pay more than US$60 million in settlements arising from a US government investigation into overseas operations that may breach the US Foreign Corrupt Practices Act (FCPA). The FCPA reportedly stops US companies from bribing foreign officials, which according to the US Department of Justice (DoJ) and US Securities and Exchange Commission (SEC), “includes doctors and other employees of government-run public hospitals”. Whilst Pfizer has reportedly not yet admitted to any wrongdoing, negotiations with the DoJ and SEC are still underway. According to the WSJ, other pharmaceutical companies have come under the US government’s scrutiny, with Johnson & Johnson paying US$70 million in settlements earlier in 2011. Johnson & Johnson reportedly neither admitted nor denied the accusations.
WSJ: Pfizer Near Settlement on Bribery (21 November 2011)
(Source: WSJ; DoJ)


UK Manufacturer Gets £20 Million Fine for Price Fixing
Anti-Bribery and Anti-Corruption, Business Ethics and Corporate Culture, Competition, Consumer Protection

This is Money reports that the German cartel office has fined UK manufacturer Reckitt Benckiser £20 million for illegally co-ordinating the prices of a dishwashing detergent with rival Henkel. The fine reportedly comes after the company paid £10.2 million in fines in 2010 for violating of competition laws in the UK. Henkel reportedly avoided fines by acting as the whistleblower.
This is Money: Reckitt Benckiser fined £20m for price fixing after colluding with rival Henkel over dishwashing products cost (23 November 2011)
(Source: This is Money)


Swiss Subsidiary Fined US$42 Million on Bribery Charges
Anti-Bribery and Anti-Corruption, Business Ethics and Corporate Culture

Reuters reports that Swiss Office of the Attorney-General (the Office) has fined a Swiss subsidiary of French conglomerate Alstom US$2.72 million for “corporate negligence”, on top of an approximately US$42 million payment roughly equivalent to the company’s estimated profits. The Office has reportedly concluded, after a two-year criminal probe, that Alstom is not directly responsible for the bribery of civil servants in Latvia, Malaysia and Tunisia. According to swissinfo.ch, the Swiss subsidiary fined was Alstom Network Schweiz AG. Alstom will reportedly not pursue an appeal, and has stated that it is satisfied with the Office’s findings.
Reuters: Alstom fined $42 mln in Swiss bribery probe (22 November 2011)
swissinfo.ch: Alstom found guilty in three cases of bribery (22 November 2011)
(Source: Reuters; swissinfo.ch)


Call for ‘Responsible Capitalism’ in Exec Pay
Business Ethics and Corporate Culture, Employment and Workplace Issues

The Guardian reports that Business Secretary Vince Cable has welcomed the High Pay Commission’s (HPC) independent inquiry into the UK’s “deeply corrosive” levels of company executives’ compensation. Reportedly, Barclay’s top executive pay, the HPC says, has risen nearly 5,000% in 30 years, and is now 169 times greater than the average wage at Barclay’s. In its 12 suggestions for reform, the HPC has reportedly called for transparency in setting executive pay, employees’ participation on remuneration committees and public oversight. According to the Guardian, Mr Cable said that he is working towards “responsible capitalism where rewards are properly aligned with performance”.
Further information from the HPC
The Guardian: High executive pay ‘corrosive’ to the UK economy, report warns (22 November 2011)
(Source: The Guardian; HPC)