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EU Levies Record Fine On Auto Glass Makers

Wed, 11/12/2008 - 3:56am
Aoife White, AP Business Writer

BRUSSELS, Belgium (AP) -- The EU's antitrust chief fined car glass producers Asahi, Pilkington, Saint-Gobain and Soliver more than 1.3 billion euros ($1.66 billion) for price-fixing, the largest sum ever levied by the EU for a cartel.

France's Compagnie de Saint-Gobain SA must pay 896 million euros ($1.14 billion) -- more than any other company has been fined before.

The European Commission said the four companies control 90 percent of the glass used to make European cars, a market worth 2 billion euros in 2003.

EU Competition Commissioner Neelie Kroes said the companies fixed prices over a period of five years and added the fines were high because European industry had to "learn the lessons the hard way."

"If you cheat, you will get a heavy fine," she said. "These companies cheated the car industry and car buyers for five years."

The EU said it increased Saint-Gobain's fine by 60 percent because the company was a cartel repeat offender. It was fined last year for an EU-wide window glass cartel, following earlier fines for a Belgian flat glass cartel in 1988 and a similar cartel on the Italian market in 1984.

Asahi Glass Co. of Japan was fined 113.5 million ($144.7 million), getting a 50 percent reduction because it cooperated with regulators.

Britain's Pilkington PLC must pay 370 million euros($471.6 million). A smaller company, Belgian-based Soliver NV was fined far less: 4.396 million euros ($5.6 million).

Regulators said Asahi, Pilkington and Saint-Gobain -- the three major suppliers of glass to European automakers -- met regularly to discuss target prices, shared out markets and allocated customers from early 1998 to early 2003. Soliver only joined some of these meetings.

The companies made glass for car windscreens, car doors, rear windows and sunroofs.

The antitrust investigation was triggered by an anonymous tip-off, the EU executive said.

Kroes could not say what prices should have been if the cartel had not hiked prices.

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