• Luxembourg: Fines imposed in Railway Switches Cartel Case
The Luxembourgish Competition Council (the Council) has fined two producers of railway switches by
decision of 23 October 2013. Two German undertakings, voestalpine BWG GmbH (voestalpine) and
Schreck-Mieves GmbH (Schreck-Mieves) were found to have participated in a market sharing and price
fixing cartel with the Luxembourgish undertaking Kihn S.A. (Kihn) and its subsidiary Vossloh Laeis GmbH
& Co. KG (Vossloh) during the period 2005 to 2011. The decision of the Council is the first decision in
application of the leniency programme as laid out in Article 21 of the Competition Law of 23 October
2011.
The aim of the cartel was to divide the Luxembourgish and German market in a way that the Luxembourgish
undertaking had guaranteed exclusivity for all public tenders organised by the Luxembourgish railway
company CFL. For each public tender, Kihn prepared and transferred prices to be submitted by the other
cartel participants. Conversely, Kihn engaged not to participate in any public tenders in Germany. The
cartel was virtually 100% successful insofar as Kihn won almost all CFL tenders. Although the cartel had its
origins in the 70s or 80s, the investigation focused on the period 2005 to 2011, for which explicit evidence
was available.
Kihn and its subsidiary were the first applicants for leniency, for which they fulfilled all the conditions, and
thus benefitted from immunity from fines. The remaining companies also applied for a reduction of fines
but did not meet the conditions. The fines imposed on them (€ 429 591 for Schreck-Mieves and € 863
636 for voestalpine) were based on the value of sales on the Luxembourgish territory for the concerned
product, taking into account the gravity of the infringement, its duration and the mitigating circumstances.
Additionally, the Council considered the overall international economic strength of all the concerned
undertakings in the relevant product field. This was necessary insofar as none of the cartel participants,
except for Kihn, reported any sales on the Luxembourgish territory, as this artificial monopoly was the
ultimate aim of the market sharing cartel. The decision can be appealed within three months before the
Administrative Tribunal.
See further information (in French) and the decision (in German)
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