Accused companies said to have discussed prices for decades

Accused companies said to have discussed prices for decades

Nestle, Swiss company Bell Group and Germany's largest sausage processor Zur Mühlen Gruppe are to appeal fines handed down over an alleged meat products cartel in the country.

The three manufacturers were among 21 companies, plus 33 individuals, hit with fines worth a combined EUR338m (US$457.6m) after being said to have taken part in deals to fix prices on sausages and ham.

Any of the companies or individuals penalised can appeal within two weeks and some have already stated they will take their case to court.

"We will appeal," a spokesperson for Nestle's German arm told just-food. "The reason is that Nestle denies Herta management took part in these discussions or meetings on the price of sausage/ham products."

Germany's competition watchdog, the Bundeskartellamt, claimed it had statements and documents that proved a "basic consensus" among manufacturers to inform each another regularly about demands for price increases. Suppliers were then able to demand higher prices for their products from the retail trade.

The Bundeskartellamt said sausage manufacturers had regularly met over several decades within the so-called Atlantic Group, named after their first meeting place, the Hotel Atlantic in Hamburg, to discuss market developments and prices.

In addition to the Atlantic Group meetings there had been agreements between several sausage manufacturers, particularly since 2003, to jointly implement price increases for the sale of sausage products to the retail trade, the Bundeskartellamt said.

The watchdog did not disclose individual fines but said the penalties ranged from "a few hundred thousand euros to high amounts in millions".

Swiss meat products manufacturer Bell said it had been handed a "high double-digit million fine", which it described as "unlawful".

Bell said: "Not only is the decision to impose a fine factually incorrect and legally inappropriate, but the fine is also disproportionately high for an industry with very narrow margins. The charges also pre-date the acquisition of Zimbo Fleisch- und Wurstwaren GmbH and Abraham GmbH by Bell Ltd. Bell will therefore appeal the decision to impose a fine before the court and pursue its reversal."

It added: "The legal proceedings to clear up this matter are expected to run over several years."

Fifteen small- and medium-sized enterprises were among the companies accused of taking part in the cartel.

Zur Mühlen Gruppe is Germany's largest sausage maker, with brands including Böklunder, Konecke and Schulte. A spokesperson for the company said it would appeal but declined to comment further.

A spokesperson for the Bundeskartellamt pointed to the watchdog's record in similar cases.

"We hear these kind of statements quite regularly after our cartel proceedings. Companies have the right to appeal against our decisions and then it is up to the Higher Regional Court to decide. But till now we have a very good case record," he said.