Virgin besieged

23 April 2010 By John Foley Follow @johnsfoley

After grassing on rival BA for pricefixing in 2006, Virgin itself now faces similar allegations. The stakes are high. Virgin’s brand is based on championing the consumer. Given its aim to move further into banking, and do more with coinvestors, Virgin needs a quick resolution.

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Virgin Atlantic and rival airline Cathay Pacific are under investigation by the UK Office of Fair Trading for alleged violations of competition law in fares between London and Hong Kong, the watchdog said.

"The case concerns a number of alleged contacts between employees of the two airlines over a number of years which it is alleged had the object of coordinating the parties' respective pricing strategies regarding passenger fares," the OFT said in a statement on April 22.

"At this stage it should not be assumed that the parties involved have broken the law."

Cathay alerted the OFT to the matter. As whistleblower, it would be immune from any penalties imposed. Virgin received similar immunity when it cooperated in a pricefixing case involving British Airways, set to go to trial next week.

Virgin Atlantic said it did "not believe that it has acted in any way contrary to the interests of consumers", adding that there were no definitive findings against Virgin Atlantic.

The OFT said it would make its socalled statement of objections relating to the case available to those who could provide material assistance.

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