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Hefty fines for foam cartel

Hardy GraupnerJanuary 29, 2014

European antitrust authorities have fined a number of industrial foam producers for coordinating prices over a long period of time to the detriment of consumers. They said cartels of that kind could not be tolerated.

https://p.dw.com/p/1Ayv4
Sofa in a living room
Image: Ethnicraft

The European Commission found that four major producers of flexible polyurethane foam, notably Vita, Carpenter, Recticel and Eurofoam, participated in an illegal cartel from October 2005 and July 2010.

The EU executive announced Wednesday it had slapped 114 million euros ($156 million) in fines on three of the companies in question for large-scale collusion.

It added the firms colluded to coordinate the sale prices of various forms of foam in 10 EU member countries, including Germany, France and the UK.

Vita goes unpunished

Polyurethane foam is used in household furniture such as mattresses or sofas, with applications in the automotive sector also accounting for around a quarter of the total flexible foam market.

Breweries fined for price-fixing

EU Competition Commissioner Joaquin Almunia said the way the cartel behaved was not acceptable.

"Cartels harm our entire economy and cannot be tolerated," Almunia said. "This case illustrates how essential it is to keep fighting and sanctioning such illegal behavior."

Vita was not fined as it benefited from immunity under the Commission's 2006 Leniency Notice for revealing the existence of the cartel to antitrust authorities.