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European Commission - Press release

Antitrust: Commission fines nine producers of window mountings €86 million for price fixing cartel

Brussels, 28 March 2012 - The European Commission has fined nine European producers of mountings for windows a total of € 85 876 000 for operating a cartel by which they agreed on common price increases, in breach of EU antitrust rules. The collusion lasted from November 1999 to July 2007 and affected European buyers of windows across all Member States of the EU and European Economic Area (EEA). The companies are Roto, Gretsch-Unitas, Siegenia, Winkhaus, Hautau, Fuhr, Strenger (all of Germany), Maco of Austria and AGB of Italy. Roto received full immunity from fines under the Commission's 2006 Leniency Notice, as it was the first to provide information about the cartel. The fine for Gretsch-Unitas was reduced by 45% and the fine for Maco by 25% in view of their cooperation in the investigation.

Commission Vice President in charge of competition policy Joaquín Almunia said: "For more than seven years, buyers of windows throughout Europe have had to face a cartel. We are determined to fight such illegal practices, whether they come from large multinationals or family-owned companies. While we have ensured that the fines we imposed today remain proportionate, they are high compared to the companies' turnover and will make them think twice if they ever think of fixing prices again."

Mountings are mechanical metal parts necessary to open and close windows and window-doors. The most common type of mountings is the so called "turn-and-tilt" mounting which allow the window to be either fully opened or tilted inwards using only one handle.

The cartel had a direct impact on customers in the European Economic Area (EEA) because mountings are an important component of windows and window-doors sold throughout Europe. The size of the market is estimated to be at least € 1 billion. The companies involved have high combined market shares in the EEA, especially for turn-and-tilt mountings where this figure is estimated to be above 80%.

The cartel was well organised and the meetings followed a regular pattern: every year in the third week of November the parties met at the occasion of trade association meetings in Germany. These regular meetings were called the "Permanent Conference". In the morning before the official meetings, the parties sat together in order to set a price increase for the following year or to agree on a surcharge for raw material costs. In the course of the following year, the cartelists met again to inform each other about the various steps they had taken to implement the agreed price increase. Local sales representatives all over Europe also had regular contacts to ensure the success of the cartel.

Fines

The fines were set on the basis of the EU 2006 Guidelines on fines. The Commission took into account the companies' sales of the products concerned in the EEA, the very serious nature of the infringement, its EEA-wide scope and its duration. For most of the parties to this case, mountings for windows constitute a large fraction of their turnover. For this reason, the fines of nearly all parties would have been capped at 10% of their total turnover, the legal maximum foreseen in the Antitrust Regulation. Exceptionally, the Commission exercised its discretion in accordance with point 37 of the Guidelines (see IP/06/857 and MEMO/06/256) and reduced the fines in a way that takes into account the mono-product nature of the companies and their differences in participation in the infringement.

The individual fines are as follows:

Fine (€)*

Includes reduction (%) under the Leniency Notice

1.

Roto

0

100%

2.

Gretsch-Unitas

20 552 000

45%

3.

Maco

18 501 000

25%

4.

Siegenia

18 995 000

0%

5.

Winkhaus

19 537 000

0%

6.

Hautau

3 179 000

0%

7.

Fuhr

2 215 000

0%

8.

Strenger

104 000

0%

9.

AGB

2 793 000

0%

(*) Legal entities within the undertaking may be held jointly and severally liable for the fine imposed.

Roto received full immunity under the Commission's 2006 Leniency Notice, as it brought the cartel to the Commission's attention and provided valuable information to prove the infringement. For Gretsch-Unitas the fine was reduced by 45% and for Maco by 25% for their cooperation with the Commission. The reductions reflected the timing of their cooperation and the extent to which the evidence they provided helped the Commission to prove the respective cartels.

Inability to pay

One of the companies invoked its inability to pay the fine under paragraph 35 of the 2006 Guidelines on Fines. The Commission thoroughly assessed the application on the basis of a financial and qualitative analysis of the ability of the company concerned and its shareholders to pay the final amount of the fine imposed, taking into account the likely effect such payment would have on the economic viability of the company. As a result of this assessment, the Commission granted a reduction of 45% of the fine.

Background

Article 101 of the Treaty on the Functioning of the European Union (TFEU) prohibits cartels and restrictive business practices.

The Commission's investigation started with unannounced inspections in July 2007 (see MEMO/07/276). The Commission adopted a Statement of Objections against the companies in June 2010 (see IP/10/776) on which they had the opportunity to comment and to be heard.

A non-confidential version of today's decision will be published, as soon as it will be available, at the following address:

http://ec.europa.eu/competition/elojade/isef/case_details.cfm?proc_code=1_39452

For more information on the Commission’s action against cartels, see its cartels website.

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.

The Commission considers that meritorious claims for damages should be aimed at compensating, in a fair way, the victims of an infringement for the harm done. More information on antitrust damages actions, including the public consultation and a citizens' summary, is available at:

http://ec.europa.eu/comm/competition/antitrust/actionsdamages/documents.html

Contacts :

Antoine Colombani (+32 2 297 45 13)

Marisa Gonzalez Iglesias (+32 2 295 19 25)


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