Virgin could lose immunity from price-fixing penalties

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Virgin Atlantic could face losing its immunity from penalties for alleged price-fixing activity after the UK Office of Fair Trading was forced to withdraw criminal proceedings against four former and current British Airways executives due to the late emergence of previously-undisclosed electronic evidence.

A jury at Southwark Crown Court in London today acquitted BA's current director of sales and marketing, Andrew Crawley, former head of UK and Ireland sales Alan Burnett, former commercial director Martin George and former head of corporate communications Iain Burns of cartel charges related to the price-fixing of fuel surcharges with Virgin Atlantic on long-haul passenger flights between July 2004 and April 2006.

Virgin Atlantic was granted immunity from penalties after it relayed details of the exchanges to the OFT. But the OFT says that last week it discovered "a substantial volume of electronic material, which neither the OFT nor the defence had previously been able to review" and, as a result of the late discovery, it accepts that "to continue with the trial in light of this unforeseen development would be potentially unfair to the defendants".

The previously-undisclosed material includes emails sent or received by Virgin Atlantic's former director of corporate affairs, Paul Moore. The OFT says it will now "be reviewing the role played by Virgin Atlantic and its advisers in light of the airline's obligations to provide the OFT with continuous and complete co-operation", adding that "this may have potential consequences for Virgin's immunity from penalties".

The OFT stresses that today's decision relates only to criminal proceedings against the four BA executives, and that it has "no reason to believe that the issues that have now arisen in those proceedings will have any impact on the OFT's civil case (save possibly as regards Virgin Atlantic's immunity), as this concerns the conduct of the companies involved rather than the alleged dishonesty of individuals".