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26 Jun 2008
Cathay Pacific and U.S. Department of Justice Resolve Air Cargo Investigation

Cathay Pacific Airways Limited announced today that it has entered into a plea agreement with the United States Department of Justice (DOJ) in connection with its ongoing investigation relating to air cargo services of a number of carriers involved in the international air cargo industry. Under the agreement, Cathay Pacific has agreed to plead guilty to a one-count violation of the United States Sherman Act relating to its air cargo business and to pay a fine of US$60 million. This will bring to an end the DOJ investigation of Cathay Pacific Cargo. The fine will be taken into account in the Company's interim results for the six months ending on 30th June 2008 to be announced on 6 August 2008.

As part of its investigation into the air cargo industry around the world, the DOJ has asserted that certain air cargo practices by Cathay Pacific and other air carriers operating out of Hong Kong were contrary to US law.

Cathay Pacific has cooperated fully with the DOJ throughout the course of its investigation and will continue to do so.

Cathay Pacific Chief Executive Tony Tyler said: "The Company has carefully considered all applicable factors and concluded that entering into this agreement at this time presents the best resolution to the investigation."

In acknowledging the terms of the plea agreement, Cathay Pacific wishes to emphasise that its staff have at all times acted in compliance with Hong Kong law.

Mr Tyler said: "Cathay Pacific has always endeavoured to comply with all Hong Kong laws and those of every jurisdiction in which we operate. Unfortunately, in this instance, it transpired that some of our actions relating to shipments from Hong Kong to the United States were in conflict with United States antitrust laws, and we very much regret this.

"Cathay Pacific is committed to its long-standing policy of full compliance with the law. I am satisfied that we have taken the best possible corrective actions to remain consistent with this policy."

Cathay Pacific will continue to cooperate with the DOJ and regulators in other jurisdictions in their respective investigations and will continue to vigorously defend itself as applicable.

Cathay Pacific has established a dedicated Competition Compliance Office to ensure that the Company's procedures and policies continue to comply with antitrust and competition laws around the world.