Competition: UK Sugar companies fined by the Commission for price fixing

United Kingdom
The investigation lasted ten years, but on 14th October 1998 the European Commission announced that British Sugar and Tate & Lyle, along with the sugar merchants Napier Brown and James Budget, were being fined for price fixing in the UK during the mid 1980's. As a result of engaging in a series of anti-competitive practices in the white granulated sugar market the Commission imposed a fine of Euros 39.6 million on British Sugar, Euros 7 million on Tate & Lyle, and Euros 1.8 million each on James Budget and Napier Brown.

The competition officials uncovered a total of 26 meetings where the companies allegedly agreed amongst themselves the prices they intended to obtain through deals with distributors. Tate & Lyle had already admitted that these meetings took place, having submitted two letters which incriminated them in the proceedings. This was taken into account when calculating the level of fines imposed. By contrast aggravating factors had to be taken into account for British Sugar. The fines were calculated using the new rule based on the serious nature of the infringements and their duration - rather than the previous method using the company's turnover.

While the Commission could not prove that the agreements on price fixing had actually been executed, it found that the frequency and number of the meetings amounted to a concerted practice according to Articles 85 and 86. This could have affected trade and pricing and therefore established liability for the four parties.

British Sugar plans to appeal the decision, its principal defence being that the meetings are alleged to have taken place before British Sugar were bought by Associated British Foods (the current owner).