Qantas Chief Executive Offi cer Geoff Dixon said today that Qantas would make a provision of US$40 million (A$47 million) to cover a potential fi ne that may be imposed in the US as a result of conduct undertaken by Qantas’ Freight Division.

“Qantas previously disclosed that it had been cooperating with regulators in the USA, Europe, Australia, New Zealand and other jurisdictions in their investigation into alleged price fi xing in the air cargo market.

These investigations revealed that the practice adopted by Qantas Freight and the cargo industry generally to fi x and impose fuel surcharges was likely to have breached relevant competition laws. To date, it has not been possible to quantify any direct or indirect liability associated with these matters,” Dixon stated. He said that Qantas decided to put the money aside following guilty pleas earlier this month by British Airways and Korean Air related to pricefi xing on fares and surcharges on bothpassenger and freighter fl ights.

Those pleas led to the imposition of a combined $800 million in fi nes by DOJ and, in the case of BA, also by the UKOffi ce of Fair Trading.

“At this stage, it is too early to make a reliable estimate of possible fines in other jurisdictions or of possible liability to third parties under class actions. We expect these amounts will be known over the next two years.”

Dixon said Qantas had strict policies requiring compliance at all times with all laws governing its Australian andinternational operations.

“We have investigated this issue thoroughly and are confi dent that the unacceptable conduct was limited to a small number of people,” he said, adding that: since the matter was before the regulators, it was not appropriate for Qantas to comment further on the issue.