Germany Fines Cosmetics Companies Over Collusion

2008-07-11 | 06:51

Ruling impacts Chanel, Clarins and others.

The German antitrust watchdog said Thursday that it would fine a number of cosmetics and perfume companies for collusion and price-fixing.

The Federal Cartel Office said it would impose fines totaling $15.7 million against companies including the German subsidiaries of Chanel, Clarins, Coty Prestige Lancaster, Estée Lauder, L'Oréal, LVMH Perfumes and cosmetics, Shiseido and YSL Beauté.

The agency said in a statement that it had found the companies shared a variety of information with each other since 1995, including on sales figures, advertising expenditures, planned product launches, prices and product returns.

The cartel office called the actions a systematic exchange between the manufacturers that restricted competition and violated German and European antitrust laws.

L'Oréal signaled that it would appeal the cartel office's decision, rejecting the office's claims that it had participated in the collusion.

Martin Ruppmann, the director of the VKE-Cosmetics Association industry group, called for more "legal certainty" regarding the language on what sort of communication between competing companies is permissible.