Brussels, 27 June 2012
Antitrust: Commission fines producers of water management products € 13 million in sixth cartel settlement
The European Commission has decided to fine a number of producers of water management products, used in heating, cooling and sanitation systems for breaching EU antitrust rules that outlaw cartels and restrictive business practices. However, the Commission reduced the fines imposed by 10% as the companies concerned acknowledged their participation in the cartel and their liability in this respect.
Flamco and Reflex were fined a total of € 13 661 000 for operating together with Pneumatex a cartel on the German market from June 2006 until May 2008. In addition, in autumn 2006, Reflex and Pneumatex expanded their anti-competitive behaviour to 13 other EU Member States1 for a limited period of three months. Pneumatex was not fined as it benefited from immunity under the Commission's 2006 Leniency Notice for revealing the existence of the cartel to the Commission.
Commission Vice President in charge of competition policy, Joaquín Almunia, said: “Most European consumers use one of the products sold by this cartel, often as part of their heating installation. Fortunately, it was discovered early thanks to our leniency programme and the companies involved agreed to reach a settlement with the Commission. Whatever the scope or duration of an infringement, I want to underline that there is no safe haven for those who participate in cartels".
For almost two years, Flamco, Reflex and Pneumatex coordinated the prices for water management products on the biggest market in Europe, namely Germany. For a short period of three months, Pneumatex and Reflex also coordinated their prices in France, Belgium, Spain, Portugal, Luxembourg, Italy, Finland, Sweden, Hungary, the United Kingdom, Greece, The Netherlands and Denmark. The cartel members informed each other through bilateral contacts of the amount and date of planned price increases and exchanged sensitive market information. Water management products include expansion vessels, pressure maintenance systems, water make-up systems, degassers, air vents, separators and safety valves.
The fines take into account the companies' sales of water management products in the markets concerned by the cartel and the very serious nature of the infringement. The fines were set on the basis of the EU 2006 Guidelines on fines. Pneumatex received full immunity from fines. The individual fines are as follows:
Reduction under the Leniency Notice
Reduction under the Settlement Notice
Flamco GmbH, Flamco Holding B.V., voestalpine Polynorm B.V. and voestalpine AG (Flamco)
3 870 000
Reflex Winkelmann GmbH & Co. KG and Winkelmann Group GmbH & Co. KG (Reflex)
9 791 000
TA Hydronics Switzerland AG
The settlement procedure
The settlement procedure is based on Antitrust Regulation 1/2003 (see IP/08/1056 and MEMO/08/458). It allows the Commission to apply a simplified procedure to suitable cases and thereby reduce the length of the investigation. This is good for consumers and for taxpayers as it reduces costs; good for antitrust enforcement as it frees up resources to tackle other suspected cases; and good for the companies themselves that benefit from quicker decisions and a 10% reduction in fines.
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 Commission's public consultation and a citizens' summary, is available at:
Antoine Colombani (+32 2 297 45 13)
Marisa Gonzalez Iglesias (+32 2 295 19 25)
France, Belgium, Spain, Portugal, Luxembourg, Italy, Finland, Sweden, Hungary, the United Kingdom, Greece, The Netherlands and Denmark