German Sausage Makers Fined for Operating Cartel

German regulators have imposed fines totaling €388m (£268m) against a group of companies dubbed the ‘Atlantic Circle’, for colluding to fix the prices of ham and cooked sausage.

Germany’s competition authority, the Bundeskartellamt or Federal Cartel Office (FCO) said the high fine was put in perspective by the number of companies involved, the length of the cartel’s operation, and the revenue gained.

The FCO imposed the penalty on 21 companies and 33 individuals for ‘concrete agreements’ going back a decade, to collectively raise prices on the food products. Collectively, the fines are among the highest imposed in the body’s history, applying to companies including Boeklunder, Wiesenhog, and Herta, a subsidiary of Nestle.

German daily
Der Spiegel
reported that the fines imposed by the FCO this year alone had risen to a record €1bn, with a fine of €340m (£270m) imposed on a group of breweries in April for similar offences.

FCO chairman Andreas Mundt said: “The total fine appears high at first glance, but it is put into perspective by the large number of companies involved, how long the cartel lasted, and the billions in revenue they are aiming to make in the market.”

In a statement, the Office said ‘numerous statements and documents’ evidenced that an ‘understanding’ had existed to communicate regularly about price increases.

The companies had met for decades as part of the so-called ‘Atlantic Circle’ – named after their first meeting place, the Atlantic Hotel in Hamburg – but in 2003 the discussions had become ‘concrete agreements’ to raise prices.

The agency said it was tipped off by an anonymous whistleblower, and that 11 companies had cooperated fully with the investigation. One group, Zur-Mühlen, denied the allegations and announced its intention to appeal against the decision.

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