Brussels downs Dutch beer cartel

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Brewers Heineken, Grolsh and Bavaria were fined an unprecedented €273.8 million after the Commission's anti-trust department uncovered evidence of price-fixing, with top management using code names to arrange secret hotel and restaurant meetings.

The illegal activity took place between "at least 1996 and 1999" during which the four brewers held "numerous unofficial meetings" to co-ordinate the price of beer in the Netherlands, the Commission said on 18 April.

The meetings, which involved high-ranking management including board members and national managers, were held at restaurants and hotels and were arranged using code names such as "agenda meeting", "Catherijne meeting" or "sliding-scale meeting" the Commission indicated.

All three were granted a reduction of €100 million, due to the exceptionally long delays since the inspections took place, the Commission indicated. Heineken N.V. landed the heaviest fine with almost €220m, while Grolsh stood at €31.5m and Bavaria at €22.8m. The decision comes after the European Court of Justice confirmed in February a €42m fine imposed on Danone for similar price-fixing in the Belgian beer market (EurActiv 9/02/07).

Belgian-Brazilian brewer InBev - also initially a member of the cartel - escaped fines after disclosing key information which enabled the Commission to uncover the group. Evidence obtained in surprise inspections carried out at the brewers' premises in France, Luxembourg, Italy and the Netherlands included hand-written notes that proved illegal activity, the Commission indicated.

"It is unacceptable that the major beer suppliers colluded to hike up prices and carve up the market between themselves," said Competition Commissioner Neelie Kroes. "The highest management of these companies knew very well that their behaviour was illegal, but they went ahead anyway and tried to cover their tracks."

Heineken said it had the intention to appeal the decision, arguing that the fine was "excessive and unjustified". "The company disagrees with the suggestion…that prices in the Dutch market were increased via co-ordinated practices," it said.

"My message to companies is clear," said Kroes. "The European Commission will not tolerate cartels. If you do take part in cartels you will face very substantial fines. So don't be tempted to start. And if you are already in a cartel, then blow the whistle to the Commission to gain immunity before someone else blows the whistle on you."

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