EU Competition Policy: The Vitamin Cartel Case

EU Competition Policy: Vitamins Cartel Case

The turnover of Microsoft as for 2010 is estimated at $62.484 billion . This is more than the budget of an average less-developed country. It is argued that multinational companies are now gaining power over the governments and placing themselves above the law. With huge profits, latest technologies, big connections, global companies became extremely influential. However, European Union proved that it still controls the enterprises regardless their size and possible influence on governments in order to protect the interests of consumers. The famous examples will include the case of Microsoft, vitamins cartel, GE. EU single market represents one of the world biggest markets with about 510 million consumers . That is the reason why European Commission was given an authority to manage EU’s competition policy.

European Competition Policy consists of 3 broad branches: antitrust/cartel policy, merger control and state aid. Antitrust sector controls behavior of companies, merger sector safeguards the market structure, state aid – prevents of undue intervention through government. Anti-trust policy is represented by 2 articles from Treaty of Rome (1957): Article 81 prohibit any agreements between enterprises which harm consumers through eliminating competition and trade between member-states and Article 82 bans abuse of dominant market position . The aim of EU competition policy is to encourage competition and develop European single market.

There is a number of ways in which commission fights against anti-competitive behavior, starting from investigation and in case enough evidence is gathered, companies participating in the cartel receive fines proportionate to the value of sales, ...

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...cartels (Hoffmann-La Roche and BASF as ‘leaders’ were engage in almost all of the cartels, while some other companies listed below were involved in 1 cartel only), the fines were distributed as follows:

F. Hoffmann-La Roche AG (Switzerland): € 462 million,

BASF AG (Germany): € 296.16 million,

Aventis SA (France): € 5.04 million,

Solvay Pharmaceuticals BV (Netherlands): € 9.10 million,

Merck KgaA (Germany): € 9.24 million,

Daiichi Pharmaceutical Co Ltd (Japan): €23.4 million,

Eisai Co Ltd (Japan): € 13.23 million,

Takeda Chemical Industries Ltd (Japan): € 37.05 million.

The rest 5 other companies, which are Lonza AG (Germany), Kongo Chemical Co Ltd (Japan), Sumitomo Chemical Co Ltd (Japan), Sumika Fine Chemicals Ltd (Japan) and Tanabe Saiyaku Co Ltd (Japan) did not received fines since they shut down the cartels before the investigation started.