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Supermarkets handed multi-million-euro fines for price fixing
The federal competition authorities have handed down fines totalling €174 million to seven supermarkets and 10 of their suppliers for price fixing.
The supermarkets concerned are Carrefour, Colruyt, Cora, Delhaize, Intermarché, Makro and Mestdagh. The highest fines in this group go to Carrefour (€36.4 million), Colruyt (€31.6 million) and Delhaize (€25 million).
The suppliers fined – both local and international – are wide-ranging and include Beiersdorf, Belgium Retail Trading, DE HBC Belgium, Henkel and Reckitt Benckiser. The highest fines have gone to Procter & Gamble (€29 million), L’Oréal (€8 million) and Unilever (€6.7 million).
The practice was brought to light by Colgate-Palmolive during an investigation; the company agreed to co-operate and avoid being fined. GlaxoSmithKline also co-operated and was given a reduced fine of €554,000.
The companies were found guilty of having co-ordinated on an increase in the consumer prices of household items, perfume and hygiene products, such as shampoo and deodorant, between 2002 and 2007. The fines form part of a new system that allows for a transactional result: The companies have admitted their offence and declined the right to appeal, in return for a 10% reduction in their fines.
Even so, the total fines package is a record for Belgium: the previous record was in 2013 with fines of €15 million in the cement sector. Véronique Thirion, the auditor-general of the competition tribunal, said the fines were elevated in response to the gravity of the case. “Price fixing is a very serious offence,” she said.
The consumer suffered the results of the price fixing over the course of five years and should therefore be compensated now, consumer organisation Test-Aankoop said in a statement. Federal consumer affairs minister Kris Peeters pointed out that the fines imposed by the competition authority are not intended to compensate victims but to act as a sanction on offenders.
Photo courtesy De Standaard
Comments
Anyone know where the fines go to? Taxpayer benefit?
i was wondering the same thing myself. the same place all legally imposed fines go, I suppose, but i don't know where that is. i'm guessing back into the justice system, which probably spent a bundle on the investigation?
But getting fined doesn't seem to have put an end to the practice. Price-fixing seems to be just as rampant as ever. The only way to avoid or escape it is to shop across any one of the borders. Not only is there competitive pricing, but the prices are also (often much) lower than Belgian prices and special offers provide real savings, not just couple of points added to a customer-loyalty card.
Weeks later and Delhaize, Colruyt and Carrefour prices seem to be more aligned than ever, down to the last penny. Plus ça change. Obviously the fines were far too low to have any impact on the tradition of price-fixing in Belgian supermarket chains. I was actually told by someone in the industry in France that in order to be allowed to take over GB, Carrefour had to sign an under-the-table agreement not to undercut the other chains.
Weeks later and Delhaize, Colruyt and Carrefour prices seem to be more aligned than ever, down to the last penny. Plus ça change. Obviously the fines were far too low to have any impact on the tradition of price-fixing in Belgian supermarket chains. I was actually told by someone in the industry in France that in order to be allowed to take over GB, Carrefour had to sign an under-the-table agreement not to undercut the other chains.