German flour mills fined for anti-competitive behavior

by World Grain Staff
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BONN, GERMANY — The Bundeskartellamt said on Feb. 19 it has concluded its cartel proceedings against companies in the milling industry and imposed fines of €41 million euros on 22 companies, the association of German mills (Verband Deutscher Mühlen e.V.) and their representatives on account of their involvement in illegal agreements in the sale of flour. 
A first fine of €24 million euros had already been imposed in the same proceeding in October 2011. 
In February 2008, the Bundeskartellamt searched several milling companies in Germany after receiving information from the market about agreements on prices and quantities. Subsequently, several companies filed applications for leniency and offered their cooperation in clarifying the facts of the case. 
“Since 2001 representatives of the milling companies involved had agreed on prices, customer allocation and supply volumes in regular rounds of talks. The agreements applied to all forms of flour distribution, i.e. to industrial customers (such as e.g. bakery product manufacturers and bakery chains), artisan bakers and the direct sale of flour in small packages (max. 1 kg packets) to food retailers,” said Andreas Mundt, president of the Bundeskartellamt. “With the proceedings initiated in 2008, we have uncovered and put an end to this system of price, customer allocation and market sharing agreements in the milling industry which has been practiced over many years." 
In addition, the companies coordinated capacity planning by shutting down mills or preventing mills which had already been shut down from being returned to operation. 
In addition to VK Mühlen AG, which was already fined in October 2011, the following companies were involved in the agreements: Werhahn Mühlen GmbH & Co. KG, Georg Plange GmbH & Co. KG, Mühle Rüningen GmbH & Co. KG and Pfälzische Mühlenwerke GmbH, Grain Millers GmbH & Co. KG (with its subsidiaries Bremer Rolandmühle Erling GmbH & Co. KG, Mills United Hovestadt & Münstermann GmbH and Heyl GmbH & Co. KG), Saalemühle Alsleben GmbH, Flechtorfer Mühle Walter Thönebe GmbH, Gebr. Engelke Große Mühle Hasede-Hildesheim GmbH & Co. KG, Magdeburger Mühlenwerke GmbH, Oderland Mühlenwerke Müllrose GmbH & Co. KG, Hedwigsburger Okermühle GmbH, Thüringer Mühlenwerke GmbH, Albert Mühlschlegel GmbH & Co. KG, Friedrich Wilhelm Borgstedt Milser Mühle GmbH, Südhannoversche Mühlenwerke Engelke GmbH, Frießinger Mühle GmbH, Bliesmühle GmbH, Karl Bindewald Kupfermühle GmbH, Cramer Mühle KG, Heinrich Thylmann GmbH & Co. KG Kilianstädtermühle, Rheintal Mühlen GmbH and Heiss Mühle GmbH.
A representative of the association of German mills also participated in the cartel discussions and assisted the representatives from the various mills in organizing meetings of the cartel and coordinating the agreements.
The fines imposed on the individual companies are calculated according to the seriousness and duration of the involvement in the cartel. In addition, the economic viability of the companies involved was given special consideration in this particular case, also in view of the fact that the French and Dutch competition authorities have already imposed heavy fines on German mills for their involvement in other agreements. The proceedings were conducted in close cooperation with the competition authorities of the two neighboring countries.
In setting the fines, the Bundeskartellamt also took into account that in addition to VK Mühlen AG, the milling companies of the Werhahn group and Grain Millers group also cooperated extensively with the Bundeskartellamt in clarifying the accusations. 


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