Salmon farmers contest European Commission’s latest price fixing claim
Six Norwegian-based salmon farmers – including three with operations in Scotland – have denied a fresh claim by the European Commission (EC) that they were involved in price fixing between 2011 and 2019.
The Commission says it is concerned that Mowi, Salmar, Lerøy, Grieg Seafood, Bremnes and Japanese-owned Cermaq exchanged sensitive information related to sales price, volumes and production capacity, as well as other factors that affect pricing.
The companies are alleged to have broken EU competition rules in the period 2011 to 2019.
The EC’s Statement of Objection issued yesterday is the result of an investigation that began with raids carried out on offices of fish farmers in the UK and other EU member states on February 19, 2019, before the UK left the EU. Grieg Seafood Shetland (now part of Scottish Sea Farms), Mowi Scotland and Scottish Sea Farms (owned 50-50 by SalMar and Lerøy) were subjected to unannounced inspections by EC officials.
The EC was unable to raid offices in Norway, because it is not in the EU member state and as an EEA (European Economic Area) country is not under the same EU jurisdiction as the UK was at the time.
In a statement on the day of the raids, the EC said it had concerns that the inspected companies may have violated EU antitrust rules that prohibit cartels and restrictive business practices.
Mowi yesterday pointed out that the EC’s Statement of Objection is not a final decision, “but rather the Commission's preliminary view that the companies that have been investigated may have broken the EU's competition rules”.
It added that it disputes the Commission's preliminary view and the characteristics of the alleged behaviour in the market for Norwegian farmed salmon, and strongly believes that there has been no breach of the competition rules.
The other accused companies also contest the accusations.
The EU suspects that the purpose of the alleged information sharing was to “reduce normal uncertainty” in the market for the sale of Norwegian farmed salmon to the EU.
The allegations apply to the sale of fresh Norwegian farmed salmon to the EU in the spot market. They do not include the sale of salmon on long-term contracts, and not frozen salmon or processed products such as salmon fillets and smoked salmon.
Robert Næss, investment director at Nordea bank, told media outlet NRK that the market fears that the companies risk significant fines, of up to 10% of turnover.
Mowi has had a turnover of up to NOK 60 billion, and the fine could therefore ultimately amount to NOK 6bn (£452 million).
“But the companies contest this, so the outcome is uncertain. It is reasonable to assume that this is a process that may take several years to clarify,” Næss told NRK.