EU Hits Flat Glass Cartel With A Fine Of 486 Million Euros
The world's four biggest float glass manufacturers have been fined by the European Commission a total of 486 million euros for running an illegal price fixing cartel. The companies involved in the cartel are Asahi of Japan, Guardian of the US, Pilkington of the UK, and Saint-Gobain of France.
"The Commission has established that in 2004 and 2005, representatives of these companies met covertly at hotels and restaurants around Europe. At these meetings they conspired to increase prices of flat glass, discussing both the amount and the timing of price increases.
"The companies profited from selling flat glass at artificially inflated prices. The direct victims were the buyers of the flat glass, companies who made products such as double-glazing and safety glass. But the final victims were once again European consumers, who had to pay the price for the glass used in buildings, private homes and apartments," said EU Competition Commissioner Neelie Kroes.
"The flat glass market was worth about 1.7 billion euros in 2004. So the companies, and their shareholders, will have done very well out of this cartel. Until today. It is right that the punishment in this case is severe, in order to achieve a sufficient deterrent effect. It is a great pity that the Commission's many previous cartel decisions did not deter these companies from forming this cartel in 2004. The Commission has backed my recommendation for a fine of 486.9 million euros," she added.
Guardian will have to pay the biggest share of penalty, in the total amount of 148 million euros. Pilkington was fined 140 million euros, while Saint-Gobain will be "relieved" of 133.9 euros. After substantial cooperation under the Leniency Notice, Asahi has been fined 65 million euros.
Frankly, the "unearthing" of a Glass Cartel does not suprise me! The price fixing has been going on for a great number of years and the individual governments simply turned a blind eye. The European Commissioner may bang a few drums but how loud is the sound? Cleary the EU does not wish to 'hurt' the cartel - 3 of the 4 (repeat) offenders are EU based....Do they want job losses in EU based countries? So this "deterrent" figure is rap on the knuckles for being 4 bad boys! As for the future, well, we should expect a slight drop followed by higher glass prices. Remember someone's going to have to pay for this fine!! Share prices for AGC have already bounced upward and as for taking action against the "Gang of four" for compensation.....Good luck people! Those clever people at the EU made sure that only the "end user" would benefit. So this is truly damage limitation. Frankly, if the EU commissioner had any b***s they would have cleared a path for businesses affected by the price fixing to claim compensation, and not the end user. Yeah, i can jsut see it now ..... developers rushing to meet with lawyers!
Now who wants to join my "I want cheap Glass Cartel"?
Posted on: 07-Jan-08
by Anti-trust lawyer
It is true that you have to show and prove a loss. If instead you just hiked up your prices to your customers as a result then you have suffered no loss. If you lost customers because you had to raise prices however then you might have a claim. Some suppliers however may not passed all the increase on so they may well have a claim.
Posted on: 25-Dec-07
by DutchglassCom
Sorry, according to my lawyer bad news for those who want to claim the glass industry. You have to prove that you suffer losses from this policy. Did you rise the prices to your clients? Bad luck for you, it is your client that can claim. Only the final user will profit. It gonna be hard and costly, we must think about our position if we will be a winner in the end
