European Commission fines companies for an anti-competitive arrangement in the food sector
On 27 September 2019, the European Commission (Commission) announced that it had fined two companies a total of €31.6m for breaching EU antitrust rules. A third company involved was not fined as it had disclosed the existence of the breach to the Commission.
The Commission stated that Bonduelle, Coroos and Groupe CECAB participated for more than 13 years in a cartel for the supply of certain types of canned vegetables to retailers and/or food service companies in the European Economic Area (EEA). The three companies agreed to settle the case with the Commission.
The Commission noted that the aim of the three companies involved was to:
- preserve or strengthen their position on the market
- maintain or increase selling prices
- reduce uncertainty regarding their future commercial conduct
- formulate and control marketing and trading conditions to their advantage
To achieve this aim, the companies the Commission found that the companies had:
- set prices
- agreed on market shares and volume quotas
- allocated customers and markets
- coordinated their replies to tenders
- exchanged commercially sensitive information
The agreements involved the (i) private label sales of canned vegetables to retailers in the EEA, (ii) private label sales of canned sweetcorn to retailers in the EEA and (iii) own brands and private label sales (sold under retailers' brands) of canned vegetables to retailers and to the food service industry (specifically in France).
According to the Commission, Bonduelle received full immunity for revealing the existence of the arrangement to the Commission, thereby avoiding a fine of approximately €250m. Coroos and Groupe CECAB benefited from reductions of their fines for their cooperation with the Commission investigation. The Commission applied a reduction of 10% to the fines imposed on the companies due to their acknowledgment of participation in the arrangement. The Commission is continuing to investigate a fourth company.
One company invoked its inability to pay the fine and after an examination of the circumstances the Commission granted a reduction of the fine.
EU (and Irish) competition law prohibit cartels and other restrictive business practices. The Commission's investigation in this case began with unannounced inspections in October 2013. As with the Competition and Consumer Protection Commission (which enforces EU and Irish competition law in Ireland), the Commission uses such dawn raids to obtain evidence to assist them with their investigation.
This is the second recent EU cartel case relating to canned foodstuffs.
Any person or company affected by anti-competitive behaviour can bring the matter before the courts of the Member States (including before the Irish Courts) to try to obtain damages. The 2014 EU Antitrust Damages Directive was implemented in Ireland in 2017 and is designed to make it easier for victims of breaches of competition law to claim damages for loss suffered.
For queries or for further information on this topic please contact Alan McCarthy, Partner, EU, Competition & Procurement, or any other member of A&L Goodbody's EU & Competition team.