EU fines animal feed cartel €175m

A MASSIVE €175.6 million fine has been imposed by European Union regulators on 13 chemical producers for setting up a cartel on the price of animal feed phosphates which are used as mineral supplements in food for pigs and poultry.

The price fixing and market sharing was started back in 1969 and carried out over the next 30 years. It was unearthed in 2004 when two of the companies, Kemira and Yara, turned whistleblower.

The scale of the fraud was such that it affected every member state.

Reacting to the news yesterday, a NFU Scotland spokesman described the scale of the fraud and the fines as "mind-boggling".However he believed the multi million fines were justified, saying: "For 30 years, many Scottish livestock farmers will have been paying over the odds for any phosphates included in animal diets and we hope the fines imposed will draw a line under this unseemly issue."

Tessenderlo Chemie, one of the major companies in Belgium with more than 8,000 employees bore the brunt of the fines with an €83.7m bill. Two French firms, Timab Industries and Compagnie Financiere de Participation Roullier, shared a €59.8m bill and Spanish firm Ercos was fined €14.85m.

Because they turned whistle blower, both Kemira and Yara were not penalised.

Joaquin Almunia, commission vice-president in charge of competition, explaining the policy on whistle blowers, said companies that co-operate with the commission could count on immunity or a reduction in their fine but "there should be no doubt about our determination to unearth and punish cartel members."