Brussels smashes power cable cartel with €300m fine

Eleven power cable manufacturers have been fined a total of €300 million (£250 million) for running a cartel, the European Commission announced on Wednesday.

Six European, three Japanese and two Korean companies were found to have made illegal agreements to fix prices for almost ten years from 1999.  All received fines except for ABB, which blew the whistle on the cartel.

The companies, which make underground and subsea high voltage cables, allocated customers between them on a global scale.

Competition commissioner Joaquín Almunia said: “These companies knew very well that what they were doing was illegal. This is why they acted cautiously and with great secrecy. Despite this and through joint efforts by several competition authorities around the world, we have detected their anti-competitive agreements and brought them to an end.”

The producers had agreed to stay out of each other’s home markets and divide the rest of the world between them, the Commission found. They met regularly and agreed on price offers to make sure the designated supplier for a particular tender bid the lowest price.

The investigation kicked off when the Commission made surprise raids on the companies in January 2009. It used forensic IT to recover several thousand documents deleted by Nexans.

There was evidence the companies knew they were breaking the rules. For example, one meeting note read: “It would be tough unless the pie for each company increases and the merits exceed the risk of having cartel”.

Prysmian (€105 million or £87 million) and Nexans (€71 million or £59 million) received the heftiest fines. J-Power Systems, Viscas, Exsym, Brugg, NKT, Silec, LS Cable and Taihan were also punished for their involvement.

Any firm affected by the cartel’s actions may seek damages.