The European Commission has imposed a fine of €337.5 million on food giant Mondelez for hindering cross-border trade in chocolates, biscuits and coffee products between European Union Member States. The Community Executive concludes that the company, based in the United States, has thus tried to prevent products from moving between countries and for consumers to obtain lower prices. Something that is a clear violation of EU competition rules. All, moreover, at a time of high inflation.
“Food prices differ between Member States. Cross-border trade between Member States in the internal market can lower prices and increase the availability of products for consumers,” the vice-president of the Commission in charge of Competition Policy, Margrethe Vestager, remarked this Thursday when announcing the sanction. . “This is especially important in times of high inflation. “In today’s decision we found that Mondelez illegally limited cross-border sales throughout the EU to maintain higher prices for its products to the detriment of consumers,” Vestager added.
Brussels opened an antitrust investigation into Mondelez, owner of brands such as Oreo, Toblerone, Cadbury and Tuc. Now, following an in-depth investigation, it concludes that it violated EU competition rules by engaging in anti-competitive agreements or concerted practices aimed at restricting cross-border trade in various chocolate, biscuit and coffee products and by abusing its dominant position in certain markets. national sales of chocolate bars.
Mondelez, the Commission says, engaged in twenty-two agreements or “anti-competitive concerted practices” across all EU markets between 2012 and 2019; something that violates the treaties. In addition, it limited the territories or customers to which seven wholesale customers (merchants) could resell Mondelez products, which in many cases required prior authorization from its distributors to sell in other countries. One of those agreements also included a provision that ordered the confectionery giant’s client to apply higher prices for exports, compared to domestic sales.
The Commission also concludes that the company abused its dominant position between 2015 and 2019 and violated other articles of the treaties by refusing to provide a broker in Germany to prevent the resale of chocolate in the territories of Austria, Belgium, Bulgaria and Romania, where prices were higher; and by ceasing the supply of chocolate bars in the Netherlands to prevent their importation into Belgium, where Mondelez sold these products at higher prices.
Brussels says Mondelez’s illegal practices prevented retailers from freely purchasing products in lower-priced member states and artificially divided the single market. The candy giant’s goal was to prevent cross-border trade from leading to price drops in countries with higher prices. “These illegal practices allowed Mondelez to continue charging more for its own products, to the ultimate detriment of EU consumers,” says the Community Executive.
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