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German sugar companies fined €280m for price fixing

By Caroline Scott-Thomas+

19-Feb-2014

German sugar companies fined €280m for price fixing

Germany’s three largest sugar companies, Sudzucker, Pfeiffer & Langen, and Nordzucker have been fined a total of €280m for price fixing by the German competition authorities.

The three firms were accused of colluding to limit the distribution of sugar in Germany up until 2009. The Federal Cartel Office found that they instead had exported sugar abroad, and concluded anticompetitive agreements on sales areas, quotas and prices, with the scheme reaching back to the mid-1990s.

All three countries have agreed to settle with the antitrust authority.

President of the Federal Cartel Office Andreas Mundt said in a statement: The aim of the agreements between Nordzucker, Pfeifer & Langen and Südzucker was to achieve the highest possible prices for their sugar. This type of coordination was not permitted under the European sugar market regulation. In spite of the quota system and minimum price guarantees, competition for sales areas, customers and customer prices is still possible in the sugar market and is also necessary to maintain functioning residual competition in order to protect customers against even greater distortion of competition in this sector.”

Sudzucker received the largest fine, of €195.5m, while Nordzucker said it had accepted a fine in the single-digit millions and had used the investigations to scrutinise its business processes.

The fines were based on 10% of the companies’ turnover and were also relative to the seriousness of the offence. However, they are still open to appeal at the Düsseldorf Higher Regional Court.

Sudzucker said in a statement that it expected the fine to impact its operating profit for the year, but retained its outlook for operating profit to reach €650m, down from €974m the previous year.

The European Commission dropped its investigations against the firms earlier this month, after launching a probe into alleged anti-competitive practices in April last year.

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