Kintetsu World Express, Japan's second-largest international forwarder, said it will set aside $13.86 million to cover estimated costs related to an anti-trust investigation by the U.S. Department of Justice.
As a result of the decision to book the U.S. anti-trust probe-related loss reserve, Kintetsu revised downward 1.3 percent its group net profit forecast for fiscal 2010 to $90.36 million.
Kintetsu, however, revised upward 3.9 percent its group operating revenue forecast to $3.25 billion as its overseas performance has been better than expected.
Kintetsu World Express is No. 23 on The JOC Top 40 3PLs (2011).
Kintetsu said it has been under investigation by the U.S. Department of Justice since January 2008 and has been fully cooperating with the probe.
In the same anti-trust case, Kintetsu and 11 other Japanese international forwarders were already fined by the Japan Fair Trade Commission in March 2009.
JFTC ordered the 12 Japanese companies to pay a total of about $110 million for illegally restricting competition by forming a cartel to add fuel surcharges and airport security charges to air cargo service charges.
Kintetsu was fined about $18 million. In fiscal 2008, Kintetsu’s net profit plunged 62 percent to $41.9 million, due partly to the anti-trust fine.
According to JFTC, the 12 companies negotiated the arrangement at meetings of the Japan Aircargo Forwarders Association, and the practice continued from 2004 to 2007. They dissolved the cartel only after the European Union and U.S. anti-trust authorities began investigations. Fuel surcharges were rapidly rising around the world in those years amid rises in crude oil prices.
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