EU hits glass cartel with 487 million euro fines

(BRUSSELS) - EU antitrust regulators fined glass makers Asahi, Guardian, Pilkington and Saint-Gobain 487 million euros (718 million dollars) on Wednesday for running an illegal price fixing cartel.

The European Commission accused the companies of conspiring to coordinate price hikes and taking other actions to control prices for flat glass used in construction through illegal meetings from early 2004 to early 2005.

The four companies hold a combined 80 percent share of the European flat glass market, which was worth 1.7 billion euros in 2004, according to the European Commission.

"The companies will have done very well out of this cartel until today," EU Competition Commissioner Neelie Kroes told reporters in Brussels.

"It is right that the punishment in this case is severe in order to achieve a sufficient deterrent effect and it is a great pity that the Commission's many previous cartel decisions did not deter the companies from forming the cartel," she added.

Guardian, a US company, got the biggest fine of 148 million euros for its role while Britain's Pilkington was fined 140 million euros and French group Saint-Gobain was ordered to pay 133.9 million euros.

Japanese group Asahi, which cooperated with the Commission and provided additional evidence in the case, received a much lower fine of 65 million euros.

The case goes back to February and March 2005 when surprise inspections were carried out at the companies' premises.

The four can appeal against the fines at the European Court of Justice while people who consider they were affected by the cartel can seek damages.

Saint-Gobain and Pilkington are also targetted in a separate investigation by EU regulators on suspicion that they participated in a car glass cartel.

A spokeswoman for Saint-Gobain said the company "took note" of the decision and that it had set aside 650 million euros for the fine and any possible penalty in the car glass case, for which it expected a "substantially higher fine."

Kroes has made a "no-tolerance" crackdown on cartels a priority during her tenure as Europe's top regulator and has lodged ever-rising record fines against the illegal clubs.

The construction glass cartel was the seventh such grouping to be fined so far, bringing total penalties this year to over three billion euros, officials said.

In February the Dutch commissioner slapped the biggest fine ever in a EU cartel case by ordering leading lift makers to pay a combined 992 million euros.