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EU Imposes $154 Million Fine on Polyurethane Foam Producers for Cartel Activity

Wednesday, February 05, 2014
Sandler, Travis & Rosenberg Trade Report

The European Commission announced recently that it has imposed fines totaling €114.1 million ($154.1 million) on three major producers of flexible polyurethane foam that were found to have participated in a cartel. Specifically, these companies colluded to coordinate the sales prices of various types of foam, which are mainly used in household furniture such as mattresses or sofas but are also used in the automotive sector (particularly car seats), for nearly five years in ten EU member states.

In determining the penalty amount the Commission took into account the companies’ sales of the products concerned in the relevant member states and the serious nature, geographic scope and duration of the infringement. However, two of the companies had their fines reduced by 50% for cooperating with the Commission’s investigation, and a fourth firm involved in this scheme was not fined at all because it revealed the existence of the cartel to the Commission. All the companies had their fines reduced another 10% for acknowledging their participation in the cartel and their liability in this respect.

The Commission notes that this is the tenth settlement decision since the introduction of the settlement procedure for cartels in June 2008 and that others have involved dynamic random access memory semiconductors, animal feed phosphates, washing powder, glass for cathode ray tubes, compressors for fridges, water management products, wire harnesses, and Euro interest rate derivatives and yen interest rate derivatives.

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