Top > Business > 2007 > April > 2007-04-19

Heineken, Grolsch and Bavaria Fined for Cartel Practices

The European Union fined the beer manufacturer Heineken NV $297 million, Grolsch NV $42.88 million and the privately held Bavaria $30.96 million, for cartel practices they were engaged from at least 1996 to 1999, by coordinating price increases of beer. The EU exempted the Brewer InBev SA from a fine because it blew the whistle on several European beer cartels, after it was caught fixing prices in Belgium.

According to EU Competition Commissioner Neelie Kroes, consumers could file for compensation for damages inflicted by the cartel in national courts. "If you do take part in cartels, you will face very substantial fines, so don`t be tempted to start is my advice," she said. "If you are already in a cartel, then blow the whistle to the Commission to gain immunity before someone else blows the whistle on you." According to sources in the EU, in all 4 companies, cartel talks were held by high-ranking executives, board directors and sales managers, while aware the law is being broken, thus using codes, when referring to meetings held in restaurants and hotels. "The management of these companies at the very highest level participated in this cartel ... knowing that this behavior was illegal," Kroes said. "Instead of respecting the law, they instead covered their tracks."

Heineken replied to the fine, which it called "excessive and unjustified," by saying it would study the ruling with the intention of appealing to the EU courts. Grolsch said it was "stunned" by the fine imposed and that it would appeal it. Bavaria had already stated, it would contest any fine, before the fine was announced.