Commission Fines Canned Vegetable Cartel with EUR 31.6 million
On 27 September 2019, the European Commission fined the vegetable canning companies Coroos and Groupe CECAB with respectively EUR 13,647,000 and EUR 18,000,000 for their participation in a cartel for the supply of certain types of canned vegetables in the European Economic Area (EEA). The cartel was revealed by Bonduelle, which thereby avoided a fine of approximately EUR 250 million.
Findings of the Commission
The Commission found that Bonduelle, Coroos and Groupe CECAB participated for more than 13 years in the alleged cartel. The aim of the companies was to preserve or strengthen their market position, to maintain or increase selling prices, to reduce uncertainty with regard to their future commercial conduct, and to formulate and control marketing and trading conditions to their advantage. In order to achieve these goals, prices were set, markets and customers were allocated, market shares and volume quotas were agreed on, replies to tenders were coordinated, and commercially sensitive information was exchanged.
The investigation of the Commission revealed the existence of a single infringement that was comprised of three separate agreements. It concerned (i) an agreement covering private label sales of canned vegetables such as green beans and peas in the EEA, (ii) an agreement covering private label sales of canned sweetcorn to retailers in the EEA, and (iii) an agreement covering own brands and private label sales of canned vegetables to retailers and the food service industry in France. Bonduelle and Groupe CECAB participated in all three agreements. Coroos only participated in the first agreement.
For revealing the existence of the cartel, Bonduelle received full immunity. As mentioned above, it thereby avoided a fine of approximately EUR 250 million. The fines of Coroos and Groupe CECAB have been considerably reduced by the Commission due to their (i) (timely) cooperation with the Commission’s investigation and the extent to which the evidence they provided helped the Commission to prove the existence of the cartel (Coroos 15%, Groupe CECAB 30%), and (ii) acknowledgement of their participation in the cartel and their liability in this respect (both 10%). In addition, the fine of one of the companies was further reduced because of a successful appeal on its inability to pay the fine. It, however, does not follow from the Commission’s press release which of the two companies it concerns and by what percentage the fine was further reduced.
Moreover, in the context of the same investigation the Commission initiated a standard (non-settlement) cartel procedure against vegetable canning company Conserve Italia. That procedure is still ongoing.
Cartel Members, be Aware!
The canned vegetable cartel proves once again that revealing the existence of a cartel can pay off. After all, a company can avoid enormous fines when applying for full immunity under the Commission’s leniency programme. This does not apply to the other participants of such cartel. They can at most limit the damage by (timely) cooperation and acknowledgement of their participation in and liability for the cartel. On the other hand, the acknowledgement of liability for a cartel – which is a prerequisite under the Commission’s leniency programme and settlement procedure – facilitates the way for victims of a cartel to claim damages before national courts.
Are you worried that your company may be involved in anti-competitive behaviour or do you have questions? Do not hesitate to contact us. Loyens & Loeff has extensive experience in the field of leniency applications, settlement procedures and (standard) cartel procedures, and we would be pleased to advise and assist you.