Business
EU imposes multimillion fine on Mondelez for distorting competition
Mondelez distorts competition for years and raises product prices – US corporation now pays the bill.
The Food Giant Mondelez Has Distorted Competition for Years and Artificially Inflated Its Prices. On Thursday, the EU Commission Imposed a Fine of 337.5 Million Euros, as the Competition Authorities Announced.
Mondelez, known for brands like Milka, Toblerone, Daim, Oreo, and Philadelphia, has manipulated competition within the EU by restricting the trade of chocolate, biscuits, and coffee products between member states. This led to prices in some EU countries being significantly higher than in others, where the products were offered at a cheaper price. Specifically, Mondez prevented the purchase of chocolate in Germany, where it is cheaper, and its resale in more expensive markets like Austria and Belgium.
"The price differences between member states ranged from 10 to 40 percent, sometimes even more," said Margrethe Vestager, the EU Commissioner for Competition. The EU Commission had opened an official procedure in January 2021 and has now concluded that Mondelez was involved in 22 anticompetitive agreements or coordinated practices. These practices took place between 2012 and 2019 and affected all EU markets.
Mondelez pointed out in a statement that the criticized practices were isolated cases, which occurred a long time ago, and mostly involved transactions with intermediaries. "This represents only a very small part of Mondelez International's European business," the company announced. Mondelez has tightened its internal processes to comply with regulations.
The EU Commission receives support from the European Consumer Organisation Beuc. "It is unfair and simply wrong when consumers in some EU countries have to pay more for their chocolate, biscuits, and coffee than in other countries because of the illegal behavior of a company," said Beuc Director General Monique Goyens.
The penalty should actually have been even higher. However, since Mondelez cooperated with the EU Commission and acknowledged its responsibility, the fine was reduced by 15 percent. According to Mondelez, provisions for the expected penalty had already been made in 2023.
In NASDAQ trading, Mondelez shares temporarily fell by 1.08 percent and traded at 69.46 US dollars.
