Heineken wins reduction of EU beer cartel fine in court ruling

So they thought the Court would overturn a finding by the European Commission? Fat chance. On 16 June 2011 Heineken announced that the General Court of the European Union in Luxembourg has largely upheld the finding of the European Commission dated 18 April 2007, which said that Heineken and Bavaria had violated EU competition rules during the period 1996 - 1999 by setting up an illegal beer cartel in the Netherlands.

Four years ago the European Commission fined Dutch brewers Heineken, Royal Grolsch and Bavaria a total of EUR 273.8 million because they had coordinated prices and price increases of beer in the Netherlands.

The Belgian brewer InBev, although involved in the illegal activity, received no fines as it acted as the cartel’s whistleblower.

Now the General Court decided to reduce the initial fine of EUR 219 million imposed on Heineken in 2007 by EUR 22 million, or about 10 percent, while Bavaria’s fine was reduced to EUR 20.7 million from EUR 22.8 million.

Jean-François van Boxmeer, CEO of Heineken, commented: "We are disappointed that the General Court has not accepted all of our arguments, but we appreciate that the Court has reduced the amount of the original fine."

It’s worthwhile studying the fine print of the Court’s ruling, though. The most important reason for the reduction is that the court believes the 7-year investigation into the cartel had taken too long.

Another reason for the discount was that the court did not see evidence that the brewers set illegal lending conditions for bar owners, of which the brewers were also accused by the European Commission.

Mostly, however, the Court concurred with the Commission’s original finding that "it is unacceptable that the major beer suppliers colluded to hike up prices and carve up the market between themselves." These were the words of the then EU competition commissioner Neelie Kroes.