EC Fines Pometon EUR 6.2 million for Participation in Steel Abrasives Cartel
OREANDA-NEWS. In April 2014, the Commission adopted a settlement decision concerning the participation in the same cartel of Ervin, Winoa, Metalltechnik Schmidt and Eisenwerk W?rth. Pometon chose not to settle and consequently the investigation continued under the normal cartel procedure. In December 2014, the Commission sent Pometon a statement of objections, giving it the opportunity to exercise its rights of defence.
Commissioner Margrethe Vestager in charge of competition policy said: "The steel abrasives cartel adversely affected a wide range of European manufacturing industries to the ultimate detriment of consumers. Today's decision once again shows the Commission's determination to sanction cartels and impose fines on all participants."
The Commission has found that for more than 4 years, Pometon participated in a cartel and had contacts on a bilateral and multilateral basis to coordinate prices of steel abrasives in the whole European Economic Area (EEA).
The cartel concerned steel abrasives, which are loose steel particles used for cleaning or enhancing metal surfaces in the steel, automotive, metallurgy and petrochemical industries. They are also used for cutting hard stones such as granite and marble.
Metal scrap, which is the main raw material for steel abrasives, is characterised by sharp price fluctuations as well as significant price differences between the EEA countries. To compensate for such fluctuations, the cartel participants set up together a specific surcharge (called the "scrap surcharge" or "scrap cost variance (SCV)") based on a common formula. In addition, the cartelists agreed not to compete against each other on price with respect to individual customers.
The fine was set on the basis of the Commission's 2006 Guidelines on fines. As in the settlement decision concerning the same cartel, the Commission took into account, in particular, the company's sales of the products concerned in the EEA, the serious nature of the infringement, its geographic scope and its duration, the appropriate level of deterrence.
The fine imposed on Pometon is € 6 197 000.
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 being reduced on account of the Commission fine.