Sorbates cartel gets slapped
1 Oct 2003
The European Commission has fined Hoechst, Chisso Corporation, Daicel Chemical Industries, The Nippon Synthetic Chemical Industry and Ueno Fine Chemicals Industry for operating a cartel in the sorbates market between 1979 and 1996.
Hoechst was fined 99 million Euros, Daicel Chemical Industries 16.6 million, Ueno 12.3 million and Nippon Synthetic 10.5 million.
The EC decision follows an investigation which showed that between the end of December 1978 and 31 October 1996 (30 November 1995 for Nippon) Hoechst, Chisso, Daicel, Nippon and Ueno operated a cartel by which they agreed prices and allocated volume quotas for each other.
In 1995, the five companies controlled about 85 % of the sorbates market in Europe. Until it transferred its sorbates business to Nutrinova in 1997, Hoechst was the largest producer of sorbic acid the main type of sorbates followed by Daicel.
Sorbates are anti-microbial agents capable of retarding or preventing growth of micro-organisms such yeast, bacteria and moulds primarily in foods and beverages. They are also used as stabilisers in pharmaceutical products and cosmetics. There are three types of sorbates: sorbic acid, used in margarine, mayonnaise, beverages and bakery products, among other things; potassium sorbate used in products with a high water content; and calcium sorbate used for the coating of cheese wrapping paper in France and Italy.
The probe started in the autumn of 1998 when the Commission was approached by representatives of Chisso under the Commission's Leniency policy, which enables it to obtain full immunity from being fined because it was the first to provide information on the cartel.
Hoechst was imposed the highest fine because of its overall size as well as its share of the relevant market and the fact that it had committed a similar violation in the past. The bigger fine also reflects its position as co-leader in the cartel together with Daicel.
