Wellington, Aug 24 NZPA - Air New Zealand is caught up in a case brought by Australian regulators against Middle Eastern airline Emirates in the global air freight scandal.

Letters, emails and telephone conversations between Air New Zealand managers and their counterparts at Emirates will be used as evidence, The Sydney Morning Herald reported today.

The case was brought against the Emirates in the Federal Court by the Australian Competition and Consumer Commission (ACCC).

Norm Thompson, a 31-year veteran of Air New Zealand and now deputy chief executive, and Emirates cargo executive Ram Menen allegedly first talked in October 2003 about prices they intended to charge for freight flown between Australia and New Zealand.

Mr Menen gave Mr Thompson, then Air New Zealand's sales and marketing chief, assurances that Emirates would not undercut Air New Zealand's or Qantas's freight prices, court documents show.

Days later Mr Thompson wrote to Mr Menen saying that despite the guarantee Emirates was undercutting Air New Zealand.

"After your comments on Emirate SkyCargo's selling approach, I was interested to hear from our cargo sales people that we lost some of our consolidation cargo from the Brisbane to Auckland service last weekend to Emirates at, what we are told, rates far more attractive than Air NZ's," he wrote. "Similar activity is also occurring in the Auckland, Sydney and Melbourne markets."

Emirates denies it broke the law.

The ACCC has not taken action against Air New Zealand, but in New Zealand the airline denies claims brought by this country's regulator.

The Commerce Commission has alleged that airlines throughout the world, including Air New Zealand, operated a cartel to raise the price of freighting cargo by imposing fuel and security surcharges for more than seven years.