European Court Reduces Deltafina’s Cartel Fine

     (CN) – A European court nearly cut in half a $15 million fine against an American-owned Italian tobacco producer accused of heading up a cartel in the late 1990s. The European Union’s General Court ordered Deltafina to pay about $7.8 million.

     The European Commission in 2004 fined five companies more than $25 million for fixing prices and sharing out quantities in the Spanish tobacco market from 1996 to 2001.
     Deltafina, operating in Italy but owned by U.S.-based Universal Group, was named as the cartel leader and slapped with a 50 percent increase to its fine, bringing its total penalty to more than $15 million.
     Such a fine increase would be justified in certain circumstances, the General Court of the European Union said.
     But although Deltafina was active “downstream” in the Spanish market, the evidence doesn’t add up to define it as a cartel leader, the court ruled.
     To be called a ringleader, a company must directly and intentionally implement the cartel, the court said. Deltafina was not present enough to indicate that it formed or drove the cartel, the court ruled.
     The EU General Court reduced Deltafina’s fine to about $7.8 million based on lack of leadership evidence and on the company’s cooperation with the investigation.

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