EU cartel fines - an analysis of the largest fines
The largest cartel fines in Europe’s history have all come within the past five years, and most of these have been under the Commission’s new, stricter fining guidelines. In fact, except for one notable exception, the eight largest fines were all handed down in 2006 or later, with six of those coming after 2007.
First, the basics: the largest cartel fine in the history of the commission remains the €1.4 billion levied against cartelists in the car glass industry. Although the new fining guidelines had been in place for some time, the 2008 decision ushered in a stark new reality in Europe - DG Comp could and would fine companies large amounts if a cartel ticked all of the guidelines’ boxes - that is, if it was long enough, severe enough and sold enough cartelised products within Europe. The car glass cartel allegedly did just that - a five-year long conspiracy that was worth more than €2 billion in its final year. Appeals against the fines continue.
Other recent decisions that are among the highest in EU history include a cartel in the gas industry (€1.1 billion in fines), an escalators and elevators cartel (more than €990 million in fines) and a conspiracy in gas insulated switchgear (more than €750 million). Drag your cursor over the graphic above to see more details, and which fines are being appealed.
The only major exception to the commission’s fining patterns is the vitamin cartel case - by most accounts one of the longest-running and most severe cartel ever to be discovered by antitrust enforcers. The decade-long conspiracy was fined a total of €855 million in 2001. Under today’s standards, the fines would have likely shattered records for antitrust enforcement worldwide.
As for individual companies, the pattern tends to hold. The largest individual cartel fine in history remains Saint Gobain’s €896 million fine for its role in the car glass cartel and an increase for recidivism, an aggravating factor under both the 1998 and the 2006 guidelines. Gas companies E.ON and GDF Suez were hit with matching €553 million fines for their roles in the gas cartel. And DG Comp fined ThyssenKrupp more than €479 million for participating in the elevator and escalator cartel. In fifth place is the 2001 fine against vitamin maker Hoffmann-La Roche - a €462 million penalty that stood as the EU’s highest for six years.
So why the marked increase in fines over the past few years? The commission says it stems from two distinct reasons: first, the guidelines have allowed DG Comp to fine companies to the level it believes is necessary to achieve real deterrence.
In a 2009 speech, Neelie Kroes, the former commissioner of competition, said that the new fining guidelines allowed the commission to punish anti-competitive behaviour that harmed both consumers and businesses.
“Fines were not deterrent in recent decades. We would go after a company, fine them and the impact would be minimal,” Kroes said. “Not any longer.”
Kroes and others have pointed out that the increase in fines has also come about as the commission has targeted larger, international cartels that often include major, multinational companies among their alleged members. “Our decisions are not arbitrary,” Kroes emphasised in a 2009 speech, responding to concerns about the extraordinary level of some EU cartel fines.
It certainly appears that large companies have been targeted by DG Comp cartel investigations, as seen in both the car glass and gas cartels. For example, Saint Gobain’s record fine was almost €350 million more than the second largest. However, according to GCR’s review of DG Comp cartel data, the fines were only 2 per cent of the company’s annual turnover the year prior - a year in which the company made a reported €46 billion.