EU regulators raid grain traders, distributors

July 10, 2008
Shares

, BRUSSELS, July 10 – The European Commission said Thursday its anti-trust regulators had raided the premises of grains and other farm product traders and distributors on suspicions they were running a cartel.

"Commission officials carried out unannounced inspections at the premises of traders and distributors of cereals and other agricultural products for human consumption and animal feed in two member states," it said.

"The commission has reason to believe that the companies concerned may have violated (EU) rules on cartels and restrictive business practices," it said in a statement.

A commission spokeswoman declined to comment on what firms were targetted by the investigation, how many companies were involved and which the two countries were.

The investigation, which the commission has no specific deadline to complete, comes amid growing international concerns about soaring food prices worldwide, driven in part by booming demand from Asia.

The commission, Europe\’s top antitrust watchdog, said that the fact that it raided the companies did not necessarily mean they were guilty of unlawful practices.

If the commission\’s investigation confirms its cartel suspicions, it then files formal charges against the targetted companies, which than have an opportunity to defend themselves against the accusations.

However, if the companies are found guilty they could face fines equivalent to up to 10 percent of their worldwide turnover.

EU Competition Commissioner Neelie Kroes has made fighting cartels a top priority and has in recent years levied in billions of euros (dollars) in fines against companies found to be participating in such illegal clubs.

The Dutch commissioner considers cartels to be a scourge that keep prices high for consumers by conspiring to thwart competition through secret illegal arrangements.

With high food and oil prices eating into consumer purchasing power, the commission has stepped up monitoring of commodities markets, including on the impact of speculation on prices.

EU leaders have asked the EU\’s executive arm to report back on its findings at a summit due in December 2008 with proposals on how to improve transparency.

The EU antitrust regulator is also keeping a close eye on the retail sector in Europe for signs that stores are avoiding competition.

Shares

Latest Articles

Stock Market

Most Viewed