Today the Bundeskartellamt imposed fines totalling € 38 million on three manufacturers of consumer goods on account of the illegal exchange of competition relevant information.
The companies involved are Kraft Foods Deutschland AG, Bremen, Unilever Deutschland Holding AG, Hamburg, and Dr. August Oetker Nahrungsmittel KG, Bielefeld. Investigations against a fourth major consumer goods manufacturer are still ongoing. The proceedings were triggered by an application for leniency filed by Mars GmbH, Viersen. In accordance with the Bundeskartellamt's leniency programme no fine was imposed on Mars. The company Henkel AG & Co. KGaA, Düsseldorf was also temporarily a member of the discussion group. No fine was imposed on Henkel because the company's conduct had already been dealt with in the authority's "drugstore products" proceedings (cf. Bundeskartellamt press release of 20 February 2008).
Andreas Mundt, President of the Bundeskartellamt, stated: "Certain types of information exchange between competitors are illegal under competition law. Competition is impaired by such practices, even if they are not classical hardcore agreements about prices, supply areas, customers or quotas."
The companies met regularly over several years in a discussion group. At these meetings high-ranking sales executives informed each other on the state of negotiations between their companies and several major retailers. Some of the participants also exchanged information on planned price increases for retailers for some of the product areas.
Apart from agreements between market participants, the exchange of competition relevant information can also restrict free competition and is thus illegal under German and European competition law. In various product areas, i.e. confectionery, ice cream, dry ready-to-eat meals, frozen pizzas, pet food and detergents, the branded goods manufacturers participating in the group sat face to face with their main rivals at these meetings. Knowledge of prospective requests of the retail trade and reactions of the major competitors to these could have influenced the manufacturers' behaviour to the same extent as information on price increases planned by their competitors. This type of information is usually treated by the companies with strict confidence.
The orders imposing the fines are not yet final and can be appealed against at the Düsseldorf Higher Regional Court. However, all the companies which were fined have agreed to have the proceedings terminated by settlement under the simplified procedure.
In early 2008, prompted by the leniency application, the Bundeskartellamt had conducted searches at various companies, at which documents were seized. Similar proceedings in which the authority is pursuing the suspicion of an illegal exchange of information on trade requests and price increases between competitors active in the confectionery industry are still pending. In addition, the Bundeskartellamt is following up the suspicion of agreements on price increases between two leading manufacturers of confectionery in two further proceedings. 