Brussels, 22 nd July 2009
Antitrust: Commission fines suppliers of calcium carbide and magnesium based reagents over €61 million for price fixing and market sharing cartel
The European Commission has imposed a total of € 61 120 000 fines on nine companies – Almamet, Donau Chemie, Ecka Granulate, Holding Slovenske elektrarne (for its former subsidiary TDR Metalurgija), Novácke chemické závody and its former parent 1.garantovaná, SKW Stahl-Metallurgie and its former parent companies Evonik Degussa and Arques industries – for violating the EC Treaty’s ban on cartels and restrictive business practices (Article 81). Akzo Nobel also participated but was not fined because it revealed the existence of the cartel to the Commission. Between 2004 and 2007 the companies fixed prices and shared markets for calcium carbide powder, calcium carbide granulates and magnesium granulates in a substantial part of the European Economic Area (EEA). Calcium carbide powder and magnesium granulates are used in the steel industry for desulphurisation or deoxidation purposes. Calcium carbide granulates are used for the production of acetylene, a welding gas. The fine for Evonik Degussa was increased by 50% because it had previously taken part in similar infringements.
Competition Commissioner Neelie Kroes said: “Industrial customers all over Europe suffered from this cartel for several years. The Commission will not tolerate such economic damage to Europe's industrial base”.
Calcium carbide powder and magnesium granulates are essential products in the steel production process. They remove oxygen and sulphur impurities from molten steel and improve the quality of the final product. Calcium carbide in granular form is used to produce the welding gas acetylene by adding water. Acetylene is usually used in the form of cylinder gas for cutting and welding metal. The combined markets of calcium carbide powder, calcium carbide granulates and magnesium granulates in the EEA are estimated to be worth some 175 million euros.
From April 2004 to January 2007, Akzo Nobel, Almamet, Donau Chemie, Ecka Granulate, Novácke chemické závody, SKW Stahl-Metallurgie and TDR Metalurgija operated an EEA-wide cartel, except in Spain, Portugal, Ireland and the UK. They shared the market, allocated customers and agreed price increases for calcium carbide powder in at least twelve multilateral meetings, first at the premises of a participant and later at hotels in Germany, Austria, Slovakia and Slovenia. During those meetings, participants also agreed their respective market shares.
The calcium carbide granulates producers (Akzo Nobel, Donau Chemie, Novácke chemické závody and TDR Metalurgija) used the same multilateral meetings to coordinate their behaviour and exchange anticompetitive information.
As a consequence of the collusion on calcium carbide powder, Almamet, Ecka and SKW Stahl-Metallurgie started colluding on the supplies of magnesium granulates, a possible substitute for calcium carbide powder. They organised at least five separate meetings in hotels in the neighbourhood of Salzburg, usually shortly after the calcium carbide powder meetings. The mechanism for the calcium carbide powder cartel served as an example, including the use of a market sharing table that was named the 'Bible'.
In setting the fines, the Commission took into account the respective affected sales of the companies involved as well as the very serious nature of the infringement and the geographical scope of the cartel agreements. The Commission increased the fines for Akzo Nobel by 100% and Evonik Degussa by 50% because they had already been fined by the Commission for previous cartels (Akzo Nobel - sodium gluconate - see , organic peroxide - see , choline chloride - see and MCAA - see ; Evonik Degussa - animal feed - see ) However, Akzo Nobel received full immunity from fines because it was the first company to come forward with information about the cartel under the Commission's 2002 Leniency Notice.
The Commission also took into account the cooperation of Donau Chemie and Evonik Degussa in the investigation and reduced their fines by 35%,and 20% respectively.
The fines imposed are as follows:
(*) Legal entities within the undertaking may be held jointly and severally liable for the payment of the fine
(**) of which 1 040 000 jointly and severally with SKW Stahl-Metallurgie
Action for damages
Any person or firm affected by anti-competitive behaviour as described in this case may bring the matter before the courts of the Member States and seek damages. The case law of the Court and Council Regulation 1/2003 both confirm that in cases before national courts, a Commission decision is binding proof that the behaviour took place and was illegal. Even though the Commission has fined the companies concerned, damages may be awarded without these being reduced on account of the Commission fine. A White Paper on antitrust damages actions has been published (see and ). More information, including a citizens' summary of the White Paper, is available at:
For more information on the Commission’s action against cartels, see