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Daimler's Supervisory Board to Discuss Alleged German Auto Cartel

While carmaker associations commonly discuss how to implement new emissions standards and technologies, the question being probed by regulators is whether talks among the German manufacturers constituted anti-competitive behaviour.

Reuters

Updated:July 26, 2017, 9:50 AM IST
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Daimler's Supervisory Board to Discuss Alleged German Auto Cartel
Image for representation only. (Image: Reuters)
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Daimler's supervisory board will meet on Wednesday to discuss allegations that German carmakers were involved in anti-competitive behaviour, sources familiar with the matter said. The European Union and German antitrust regulators are investigating whether BMW, VW, Porsche, Audi and Mercedes-Benz owner Daimler held meetings to discuss suppliers, prices and standards to the disadvantage of foreign carmakers.

The U.S. Justice Department’s Antitrust Division is aware of the press reports, a source close to the department said.

The division, along with antitrust enforcers in other countries, has had a long-running criminal probe into price-fixing in the auto parts industry that has led to dozens of companies paying criminal fines.

While carmaker associations commonly discuss how to implement new emissions standards and technologies, the question being probed by regulators is whether talks among the German manufacturers constituted anti-competitive behaviour.

German magazine Der Spiegel reported on Friday that German carmakers colluded to fix the prices of diesel emissions treatment systems using industry committees. Companies found guilty of breaching EU cartel rules face fines of as much as 10 percent of their global revenue.

A person familiar with the matter told Reuters on Tuesday that Daimler first raised the issue of collusion with cartel authorities, a move that could earn it immunity.



Under EU rules, a company blowing the whistle on wrongful collusion usually escapes penalties. VW's MAN trucks division was spared any fines last year after disclosing price fixing with Daimler and other truckmakers prior to 2011.

Should wrongdoing be found, VW could be treated leniently too if, as reported by Der Spiegel, it also provided early evidence to cartel authorities.

VW and Daimler declined comment on Tuesday.

VW, Europe's largest automaker, will also hold a supervisory board meeting on Wednesday about the alleged collusion.

The auto industry committees allegedly used to fix prices operated outside of the official industry association VDA, which counts foreign suppliers and foreign-owned carmakers like Opel among its members.

In a statement, VDA said compliance policies for members preclude anti-competitive behaviour, adding the issues being probed by regulators "relate to a format which was not part of the VDA and its work".

"A couple of months ago manufacturers approached VDA, to integrate further development, standard setting and norm setting activities into VDA," the association said, adding existing members were being consulted about how to deal with the matter.
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