German sausage makers face fines for price fixing
July 17, 2014
by Meat&Poultry Staff
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BONN, Germany – German anti-trust authorities imposed fines totaling €338 million ($457.2 million) against 21 sausage manufacturers and 31 individuals.
The Federal Cartel Office (Bundeskartellamt) reported that numerous statements and documents prove that a "basic understanding" developed among sausage producers to discuss price increases. The group accused in the matter is called "Atlantic Circle" after the group's first meeting at the Atlantic Hotel in Hamburg, Germany. German anti-trust officials said member of Atlantic Circle have been meeting since 2003 to discuss price increases for sausage products sold to retailers.
"The arrangements were made mostly by phone, either through reciprocal calls or organized broadcasts," the agency said in a statement. "Due to the heterogeneity of the products [different types of sausage, different pack sizes, etc.] it was not possible to define specific individual prices, [members] voted about price ranges for product groups [raw, boiled, cooked sausage and ham]. As a result, higher asking prices to the retail industry on the basis of the cartel agreement could be enforced."
An anonymous tip alerted the Federal Cartel Office to the price-fixing scheme. Eleven companies have cooperated with the agency. The fines are not final pending any appeals filed within two weeks. The Court of Appeals in Dusseldorf will hear any appeals of the fines.
"The price-fixing agreements have been practiced for many years,” said Andreas Mundt, president of the Federal Cartel Office. "The total penalty seems high at first glance, but [has to be seen in perspective] against the background of the large number of companies involved, the cartel duration and billions in sales."