ACM imposes fines for price-fixing agreements involving the purchase of used cooking oil
The Netherlands Authority for Consumers and Markets (ACM) has imposed fines, totaling almost four million euros, on two major collectors of used cooking oil, for making cartel agreements regarding the purchase of used cooking oil. The companies colluded in order to keep purchase prices as low as possible. This enabled them to improve their margins. They also shared suppliers among each other, and exchanged competitively-sensitive information. These practices took place between 2012 through 2018. Small hospitality businesses in particular, such as restaurants and snack bars, were harmed by the cartel agreements. ACM was able to track down this case thanks to information received from the Netherlands Food and Consumer Product Safety Authority (NVWA).
Martijn Snoep, Chairman of the Board of ACM, adds: ‘Businesses cannot make secret arrangements about their selling prices nor about their purchase prices. Buyer cartels harm competition and disadvantage suppliers. Such cartels result in suppliers receiving a lower price for their products.’
Who were involved in this cartel?
The former Rotie and Nieuwcom made arrangements with each other. Additionally, the former Rotie and another company also made arrangements with each other. Additionally, former collector Rotie and another company also made arrangements with each other. That other company went bankrupt prior to the start of ACM’s procedure. Personal fines are imposed on three individuals who exercised de facto leadership over the cartel arrangements for their involvement at the time of when the practices took place. The fines imposed on these individuals amount to 190,000 euros in total. These individuals as well as the companies have cooperated with ACM’s procedure. That is why ACM has lowered their fines.
How did the cartel work?
Used cooking oil (UCO) is an important and sustainable raw material for biodiesel. The EU and the Dutch government stimulate the use of biodiesel in order to promote the use of sustainable fuels for transportation. Collectors buy used cooking oil primarily from businesses in the hospitality and food industry.
The collectors held regular discussions among themselves regarding the purchase prices they paid suppliers of used cooking oil. They also discussed who could visit which supplier, and they exchanged price information. The collectors confronted each other when one of them had visited ‘their’ supplier anyway and had offered too high a price. These interactions mostly took place over email and WhatsApp.