French competition authority imposes penalty of 302 million euros against flooring producers

Source:
ACF/Fordaq
Views:
1196
  • text size

The French competition authority (The Autorité) has imposed sanctions totalling €302 million on the three leading manufacturers of PVC and linoleum floor covering, as a penalty for price fixing among other pratices.

Acting on information submitted by the Directorate General for Competition Policy, Consumer Affairs and Fraud Control (DGCCRF), the Autorité started proceedings ex-officio and, in 2013, conducted dawn raids in the floor coverings industry. The Autorité today published a decision sanctioning the three leading PVC and linoleum floor coverings manufacturers in France, Forbo, Gerflor and Tarkett, together with the relevant trade union, the SFEC (Syndicat Français des Enducteurs Calandreurs et Fabricants de Revêtements de Sols et Murs).

The Autorité revealed three practices implemented by these manufacturers:

- a wide-ranging anti-competitive agreement between the three main manufacturers of PVC floor coverings in France, covering numerous aspects of sales policy, including prices, with the aim of drastically reducing or eliminating competition in the production and marketing of PVC and linoleum floor coverings, and stabilising the respective situations of Forbo, Gerflor and Tarkett ;

- exchanges, under the aegis of the SFEC, of specific confidential information relating to their activities, enabling sales policies to be adjusted accordingly;

- the signing of a non-competition agreement, entered into with the consent of the SFEC, concerning communication relating to the environmental performance of their products.

Forbo, Gerflor and Tarkett, together with the trade association, also produced and signed a charter barring each company from advertising the individual environmental performance of its products. Manufacturers were permitted only to communicate  on the environmental performance of their product through  joint data sheets produced by the trade association. According to the terms of the charter, the effect of this agreement was to eliminate "competitive marketing practices based on environmental characteristics" and "avoid unnecessary controversy relating to particular products and adopt a consistent marketing approach" in order to prevent "reckless green marketing. "

These practices, which began during the 1990's, ceased only in the wake of the raids conducted in 2013, the authority stresses.

Consequently, the Autorité has imposed the following fines:

Organisation or company

Penalty amount

Tarkett 

165 000 000 €

Forbo

75 000 000 €

Gerflor

 62 000 000 €

SFEC

300 000 €

Total

302 300 000 €

Post comment