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Qantas to pay up to $125,000 in civil penalties in U.S.

Staff Writer |
Qantas Airways agreed to pay up to $125,000 in civil penalties after the Transportation Department charged that the foreign airline was violating rules governing flights within the U.S.

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Australia’s flag carrier denied wrongdoing, and specifically denied violating U.S. rules. But Qantas agreed to the settlement Wednesday to resolve the allegations.

The case involved the U.S. law that generally prohibits a foreign airline from carrying passengers between two cities in the U.S., which is called cabotage.

Typically, the U.S. allows foreign airlines to fly unhindered between countries, but then each country then relies on its own domestic carriers to fly within their own borders.

The department’s complaint against Qantas focused on flights from the U.S. to Tahiti and New Zealand in 2015 and 2016. The direct flights to those distant islands from Los Angeles weren’t the problem.

But some passengers began their trips at New York’s John F. Kennedy International Airport aboard Qantas planes before changing planes and carriers in Los Angeles. The passengers flew on planes operated by other airlines that were code-share partners of Qantas.

Despite passengers flying under “QF” flight numbers, the department charged that the practice violated a federal law that prohibits a foreign airline from transporting passengers within the U.S., and another federal law against unfair and deceptive practices.

Under the consent agreement with the department, Qantas agreed to halt the practices cited. Qantas agreed to pay $62,500 within one month and another $62,500 if it violates the agreement within a year.