Cartel clobbered

The European Commission has fined bitumen suppliers €183m for market sharing and price coordination in Spain.


The European Commission (EC) has fined bitumen suppliers €183m for market sharing and price coordination in Spain.


The EC found that BP, Repsol, Cepsa, Nynäs and Galp all participated in a cartel for bitumen in Spain in violation of the EC Treaty’s ban on restrictive business practices. Bitumen is a by-product produced during the distillation of oil. It is mainly used for the production of asphalt, where it serves as an adhesive to bind stones together.


BP was the first company to come forward with information about the cartel under the Commission’s 2002 Leniency Notice and received immunity from fines.


‘It is unacceptable that these companies cheated customers, public authorities and tax payers in Spain for almost 12 years by carving up the market for road-building bitumen amongst them. The Commission will not tolerate such illegal activity by companies to swindle clients and we will continue to impose stiff penalties on offenders,’ competition Commissioner Neelie Kroes said in a statement.


The value of the Spanish market for penetration bitumen in 2001, the last full year of the almost 12 year infringement, was approximately €286m.


The Commission investigation started with surprise inspections in October 2002, prompted by an application for immunity lodged by BP.


It then discovered that, from at least 1991 to 2002, cartel members established market quotas, allocated sales volumes and customers between them, monitored the implementation of the market sharing agreements by exchanging sensitive market information, compensated each other for deviations from the market sharing agreements and agreed on the variation of bitumen prices and the moment from which the new prices would apply.


Market sharing discussions were held annually to estimate and distribute the market for the following year. Discussions on market sharing and price variations were held around a so-called “asphalt table” where cartel members participated on a bilateral or multilateral basis.