Page 166 - CW E-Magazine (9-7-2024)

News from Abroad

QUESTIONABLE PRACTICES
European Commission fines IFF for obstructing

investigation into suspected fragrance cartel

The European Commission has pection. In addition, the Commission
fined US-based International Flavors & was not informed of the data deletion.
Fragrances Inc. and International Instead, Commission inspectors had
Flavors & Fragrances IFF France SAS to detect the deletion themselves after
(together IFF) Euro 15.9-mn ($17-mn) the mobile phone was submitted for
for obstructing a Commission inspec- review. The Commission opened pro-
tion in 2023. The Commission found ceedings against IFF for obstructing its
that during the inspection, a senior investigation in March 2024.
employee of IFF intentionally deleted and restrictive business practices (Article
WhatsApp messages exchanged with a 101 of the Treaty on the Functioning of the IFF said in a statement that when
competitor. European Union). Commission officials the investigation began in March
had also consulted their counterparts in the 2023, a now-former employee deleted
Ms. Margrethe Vestager, Executive Antitrust Division of the US Department messages relevant to the investigation
Vice-President in charge of competition of Justice, the UK Competition and Mar- from their mobile phone, contrary to
policy said, “Compliance with antitrust kets Authority, and the Swiss Competition the explicit instructions of IFF’s
investigations is of paramount impor- Commission. The Commission officials Legal Department and the Commission.
tance. Companies that undergo an ins- were accompanied by their counterparts After the detection, IFF immediately
pection must ensure that employees do from the national competition authorities acknowledged the facts and proactively
not delete or manipulate business records. of the Member States where the inspec- cooperated by helping the Commission
This includes communications on mobile tions were carried out. recover the deleted data. In its inves-
phones. This decision to fine IFF shows tigations, the Commission concluded
that we will not tolerate any action that During its inspection, the Com- that an overall fine amounting to 0.3%
could impact the effectiveness of our in- mission asked to review the mobile of IFF’s total turnover would be both
vestigations, and that we firmly pursue telephones of some of IFF employees. proportionate and deterrent. At the
and sanction any such obstructions.” While reviewing, the Commission same time, the Commission decided to
detected that a senior employee had reward IFF for its proactive coopera-
In March 2023, the Commission car- deleted WhatsApp messages exchanged tion during and after the inspection. It,
ried out unannounced inspections of the with a competitor containing busi- therefore, decided to reduce such fine
premises of suppliers and one association ness-related information. The deletion amount by 50% and to impose a fine
active in the fragrance industry in nu- occurred after the employee had been of €15.9-mn, which represents 0.15%
merous member states. Those involved informed about the Commission’s ins- of IFF’s total turnover.
include Swiss companies Firmenich Inter-
national SA, Givaudan SA, Symrise AG, Fluor bags EPCM contract for North-
and the US group International Flavors &
Fragrances Inc. Collectively, they pos- volt’s lithium battery facility in Germany
sess an estimated 60% market share with
combined annual revenue of over $21-bn. US-based Fluor Corporation has (€4.5-bn) project in the second quar-
Concurrently, the Commission sent out announced that its Advanced Tech- ter of 2024. Northvolt, headquartered
formal requests for information to several nologies & Life Sciences business in Sweden, manufactures batteries for
companies. The intent of both actions was has been awarded an engineering, consumer and industrial products, elec-
related to possible collusion in the supply procurement and construction man- tric vehicles and solutions for energy
of fragrances and fragrance ingredients agement (EPCM) services contract for storage systems. Fluor’s scope of work
related to potential overcharging and other phase one of Northvolt’s large-scale includes construction of the utilities
anti-competitive practices. The Commis- lithium-ion battery factory in Heide, and chemical units for the greenfield
sion was concerned about companies vio- Germany. Fluor will recognise its un- campus. Completion is scheduled for
lating EU antitrust rules prohibiting cartels disclosed portion of the total $4.8-bn 2027.

166 Chemical Weekly July 9, 2024

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