EU Fines Bayer, Zeon For Price Fixing

European Union antitrust regulators fined German chemical maker and Japan’s Zeon Corp. a total of $49.6 million for colluding to fix prices of synthetic rubber.

BRUSSELS, Belgium (AP) — European Union antitrust regulators fined German chemical maker Bayer AG and Zeon Corp. of Japan on Wednesday a total of euro34.2 million (US$49.6 million) for colluding to fix prices of synthetic rubber used in automotive parts and other products.
The European Commission said the two companies carried out their cartel between 2000-2002, to set prices of their rubber products which are widely used in the automobile industry. Bayer was hit with a euro28.87 million (US$41.84 million) fine, while Zeon got a euro5.36 million (US$7.77 million) penalty.
It was the second time in two months Bayer was named by Brussels in cartel cases to set prices on rubber products used to make hoses, belting, cable, o-rings, seals, adhesives, and sealants.
In December, Bayer escaped a fine then because it received full immunity for blowing the whistle on the price fixing for chloroprene rubber, which is used to make hoses, transmission belts and as latex used to make shoe soles and condoms.
''This is the fourth cartel decision in the synthetic rubber industry in just over three years. I hope that this is the last,'' said EU Competition Commissioner Neelie Kroes. She said carmakers and other industry buyers of synthetic rubber ''should be concerned about how much these cartels have cost them.''
Commission officials said it had started its investigation into Bayer and Zeon in 2003, conducting surprise raids on the two.
The Commission said the companies ''held regular meetings to discuss prices and to coordinate price increases, to exchange sensitive commercial information and to follow-up the implementation of their illegal plans.''
The EU executive said however, both companies cooperated to hand over evidence once their cartel was discovered by EU regulators. As a result Bayer received a 30 percent reduction in its fine and Zeon 20 percent.
The two companies had already been found guilty by U.S. Department of Justice in 2005 for similar cartel practices in the U.S. market for acrylonitrile-budadiene, a form of synthetic rubber also known as NBR.
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