OFFICE OF COMPETITION AND CONSUMER PROTECTION
International Relations and Communication Department
OCCP IS COMBATING CARTELS IN THE FOOD AND CONSTRUCTION
MARKET
One entrepreneur fined, another 16 suspected – OCCP declares war against cartels.
Prohibited agreements are one of the most serious crimes committed by the
enterpreneurs. They lead to disruption of the free market mechanism and translate into
higher prices for consumers
[Warsaw, 15 January 2007] One of the priorities of the OCCP is to increase the efficiency of
combating prohibited agreements which is one of the most harmful and most difficult to detect
practices against competition. In 2006 the President of OCCP carried out 91 administrative
proceedings and imposed fines in the total amount exceeding 285 mln PLN.
Just a few days ago the President of the OCCP fined Lesaffre Bio-Corporation – one of the
largest yeast producer in the Polish market with more than 3 mln PLN penalty. The reason was
an illegal agreement concluded by the French company with 45 wholesale firms that obliged them to
stock up exclusively in Lesaffre. This practice lasted for over 3 years and affected in particular
competitors of Lesaffre that had a limited access to the market agents.
Legal proceedings initiated in September 2005 revealed that in contracts concluded with market
agents Lesaffre reserved the exclusive right to supply them with yeast. The purchases in the
competitive companies (even those made by the relatives, associates or shareholders of the market
agents) were threatened by a penalty amounting to a few thousands of PLN. Additionally Lesaffre
reserved the right to claim additional compensation in case of infringement of the above clause.
Loyality towards the producer was rewarded – the market agent could get a few percent rebate on the
total amount of the product ordered during the year.
As an initiator of this agreement and its main beneficiary, Lesaffre was fined with the penalty
amounting to 3,1 mln PLN. At the same time the right to financial sanctions against other
members of this agreement was abandonned – mainly small family companies, where the
revenues from the yeast sales were relatively low.
It is not the first case that was conducted against Lesaffre. In 2003 the President of the OCCP issued
an opinion where it declared that a prohibited agreement of six yeast producers, including the French
company, was concluded.
The yeast market is not the only market carefully observed by the OCCP. In late December 2006 the
President of the OCCP initiated 3 antitrust proceedings against producers of paints and lacquers and
construction supermarkets. In the course of these proceedings it will be verified if prices of these
Press release
OFFICE OF COMPETITION AND CONSUMER PROTECTION
International Relations and Communication Department
products made by ICI, Nobiles Kujawska Fabryka Farb i Lakierów and TBD were fixed in agreement
with Castorama and made by TBD in agreement with Praktiker.
Moreover, 11 producers of cement are suspected of fixing common prices, settling sales terms, market
sharing as well as exchange of confidential trade information: Lafarge Cement, Grupa Ożarów,
Ekocem, Górażdże Cement, Cemex, and cement mills: Rejowiec, Chełm, Nowiny, Warta, Nowa Huta
and Odra. As the result of the biggest in the history of the Polish Antitrust Office legal search
conducted in May 2006 in cooperation with the Police Command Headquarters a large number of
evidence was collected. After analysing it, the President of the OCCP initiated the antitrust proceedings
that will prove if the law was infringed.
Illegal practices of the enterpreneurs against competition influence prices and quality of the products
and services. The collapse of the first cement cartel in Poland resulted in price decrease from PLN 70
to PLN 20 for a ton.
According to the legal regulations, taking part in agreement aiming at or resulting in
restricting the competition, is threatened by severe financial sanctions – amounting to
10% of the previous year's revenues. Avoiding the penalty or decreasing the amount of it may be
expected by the enterpreneur who will start to cooperate with the Antitrust Office (among other things
it will provide evidence of existence of a cartel). This is enabled by the leniency programme, the
idea of which was introduced into the Polish law by the amendment of the antitrust law in 2004. Until
now 8 applications for leniency were submitted to the OCCP. The President of the OCCP made use of
the leniency programme in 2006 when it decreased the amount of the penalty imposed on one of the
participant of the agreement concluded between Polifarb Cieszyn-Wrocław and owners of 7
construction supermarkets.
As confirmed by the research made by PBS DGA for the OCCP, 2/3 of the Polish entrepreneurs are
aware that fixing common prices is prohibited. However, 25% of them admit that would take a
decision to enter such an agreement and 7% has a problem to give a clear response.
Additional information:
Małgorzata Cieloch, Spokesperson of the OCCP
Pl. Powstańców Warszawy 1, 00-950 Warszawa
Tel. (22) 827 28 92, 55 60 106, 55 60 314
Fax. (22) 826 11 86
E-mail: [email protected]
Press release