Switchgear cartel bust
The European Commission has fined 11 companies a total of 750.7 million for taking part in a cartel for gas insulated switchgear projects between 1988 and 2004.
The companies are ABB, Alstom, Areva, Fuji, Hitachi, Japan AE Power Systems, Mitsubishi Electric Corp, Schneider Electric, Siemens, Toshiba and VA Tech.
Neelie Kroes, EU competition commissioner, said: “The commission has put an end to a cartel which has cheated public utility companies and consumers for more than 16 years. The case demonstrates that the Commission can and will bring down such cartels even if the companies concerned use sophisticated technology to cover their tracks.”
The Commission's file includes some 25 000 pages of documents which contain evidence spanning the entire period of the cartel. It said the companies rigged bids for procurement contracts, fixed prices, allocated projects to each other, shared markets and exchanged commercially important and confidential information.
From at least 1988, when a written agreement between the members was adopted, suppliers informed each other of calls for tender for GIS and co-ordinated their bids in order to secure projects for the cartel members or to agree minimum bidding prices. The companies agreed that the Japanese companies would not sell in Europe, and the European companies would not sell in Japan.
It also said the companies took 'sophisticated measures' to keep their communications secret. Code names were used for both companies and individuals. In the last years of the cartel they relied on anonymous e-mail addresses for communication and used encryption for sending messages, said the commission.
The commission said the Japanese companies had also been fined, despite 'their nearly total absence' from the market for GIS in Europe, because their agreement to abstain from bidding 'contributed directly to the restriction of competition' on the EU market.
ABB, whose fine was increased by 50 per cent for being a repeat offender, was however eventually granted full immunity by acting as cartel whistleblower. The commission increased the fines by 50 pct for Siemens, Alstom and Areva for their 'leadership role' in the cartel.
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