94/601/EC: Commission Decision of 13 July 1994 relating to a proceeding under Article 85 of the EC Treaty (IV/C/33.833 - Cartonboard) (Only the German, English, Spanish, French, Italian and Dutch texts are authentic)

• Published date: 19 September 1994
• Official Gazette Publication: Gazzetta ufficiale delle Comunità europee, L 243, 19 settembre 1994,Diario Oficial de las Comunidades Europeas, L 243, 19 de septiembre de 1994,Journal officiel des Communautés européennes, L 243, 19 septembre 1994

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94/601/EC: Commission Decision of 13 July 1994 relating to a proceeding under Article 85 of the EC Treaty (IV/C/33.833 - Cartonboard) (Only the German, English, Spanish, French, Italian and Dutch texts are authentic)

Official Journal L 243 , 19/09/1994 P. 0001 - 0078

COMMISSION DECISION of 13 July 1994 relating to a proceeding under Article 85 of the EC Treaty (IV/C/33.833 - Cartonboard) (Only the Dutch, English, French, German, Italian and Spanish texts are authentic) (94/601/EC)

THE COMMISSION OF THE EUROPEAN COMMUNITIES,

Having regard to the Treaty establishing the European Community,

Having regard to Council Regulation No 17 of 6 February 1962, First Regulation implementing Articles 85 and 86 of the Treaty (1), as last amended by the Act of Accession of Spain and Portugal,

Having regard to the Commission decision of 21 December 1992 to open a proceeding on its own initiative,

Having given the parties concerned the opportunity to make known their views on the objections raised by the Commission, pursuant to Article 19 (1) of Regulation No 17 and Commission Regulation No 99/63/EEC of 25 July 1963 on the hearings provided for in Article 19 (1) and (2) of Council Regulation No 17 (2),

After consulting the Advisory Committee on Restrictive Practices and Dominant Positions,

Whereas:

PART I THE FACTS

A. SUMMARY OF THE INFRINGEMENT (1) This Decision imposing fines for an infringement of Article 85 arises out of investigations carried out by the Commission in April 1991. Acting under Article 14 (3) of Regulation No 17, Commission officials visited the premises of a series of producers of cartonboard or their subsidiaries and selling agents in the Community. By means of the said investigations and subsequent enquiries under Article 11 of Regulation No 17, the Commission discovered documentary evidence showing that an infringement of Article 85 had been committed by the following undertakings:

- Buchmann GmbH,

- Cascades SA,

- Enso-Gutzeit Oy,

- Europa Carton AG,

- Finnboard - the Finnish Board Mills Association,

- Fiskeby Board AB,

- Gruber & Weber GmbH & Co KG,

- Kartonfabriek 'De Eendracht' NV (trading as 'BPB de Eendracht'),

- NV Koninklijke KNP BT NV (formerly Koninklijke Nederlandse Papierfabrieken NV),

- Laakmann Karton GmbH & Co KG,

- Mayr-Melnhof Kartongesellschaft mbH,

- Mo Och Domsjoe AB (MoDo),

- Papeteries de Lancey SA,

- Rena Kartonfabrik AS,

- Sarrió SpA,

- SCA Holding Ltd (formerly Reed Paper & Board (UK) Ltd),

- Stora Kopparbergs Bergslags AB,

- Enso Española SA (formerly Tampella Española SA),

- Moritz J. Weig GmbH & Co KG.

(2) The infringement consists of participating from about mid-1986 until at least April 1991 (in most cases) in an agreement and concerted practice by which the producers supplying cartonboard in the Community in concert and complicity and contrary to

Article 85:

- met regularly in a series of secret and institutionalized meetings to discuss and agree a common industry plan to restrict competition,

- agreed regular price increases for each grade of the product in each national currency,

- planned and implemented simultaneous and uniform price increases throughout the Community,

- reached an understanding on maintaining the market shares of the major producers at constant levels (subject to modification from time to time),

- took concerted measures to control the supply of the product in the Community in order to ensure the implementation of the said concerted price rises,

- exchanged commercial information (on deliveries, prices, plant standstills, order backlogs, machine utilization rates, etc.) in support of the above restrictions.

B. THE CARTONBOARD INDUSTRY 1. The product

(3) Cartonboard (also known as 'paperboard') is a stiff material produced from wood fibres and used primarily for the manufacture of folding cartons for packaging food and non-food consumer goods. It is also used to produce card for graphic purposes.

Cartonboard is produced by a number of methods which involve the dispersal of fibres in water at a 1 % concentration and the subsequent casting into sheets by draining the water and drying the resulting fibre deposit.

A large variety of product qualities has been developed to meet the differing requirements of end users. The quality of the material depends to a considerable extent on the choice of fibre used and its treatment during the production process. Cartonboard is usually manufactured and sold as sheets combining layers of material made from different types of pulp. It is commonly coated or laminated on its white side with various materials to enhance its appearance or make it suitable for particular applications. The basic distinction is between cartonboard produced from primary wood fibres and cartonboard made from recycled wastepaper.

(4) The main qualities of cartonboard produced in western Europe are:

- folding boxboard (FFB) manufactured with a top layer of whiteliner made from bleached chemical pulp, a middle layer of mechanical or semi-mechanical pulp, and frequently a thin bottom layer of bleached chemical pulp. FBB is usually used for the packaging of food, cosmetics, cigarettes, pharmaceuticals, etc.,

- white-lined chipboard (WLC), also known in continental western Europe as Duplex, or Triplex, and based on secondary or recycled fibres. This product is produced with bleached chemical pulp on the topside and backlayers of wastepaper and is normally used for packaging of non-food products,

- solid bleached sulphate board (SBS), a multi-layered product made from bleached chemical pulp and white throughout. It is mainly used as a premium grade for the packaging of food, cosmetics, pharmaceuticals and cigarettes.

Certain other board products (e.g. 'greyboard' which is made entirely from wastepaper) may also be produced on cartonboard machines but they do not fall within the definition of 'cartonboard' as used by the producers themselves and are not the subject of the present proceedings.

The standard product designation and abbreviations used in Germany are commonly employed in the cartonboard industry throughout western Europe.

- The coated and uncoated FBB grades are designated 'GC' and 'UC' respectively.

- Coated and uncoated 'duplex' grades of WLC are designated 'GD' and 'UD' while 'triplex' grades are known as 'GT' and 'UT'.

- Coated and uncoated SBS grades are designed 'GZ' and 'UZ' respectively.

Inside these categories there are further subdivisions: for instance, GC1 is distinguished from GC2 by virtue of the different backing layer used, GD1 from GD2 by their different specific volume, etc. For convenience, the whole of the virgin fibre sector is often referred to as the 'GC grades', and all recycled qualities as 'GD grades'. This usage will be adopted where appropriate in this Decision.

2. Market size and value

(5) As a result of inter alia overlapping product definitions, estimates of the size of the cartonboard market differ.

For the purposes of this procedure, the Commission has followed the classification used for the purposes of their own statistical exchange system (see recital 61) by the producers involved in the present proceedings.

Total production of cartonboard by Western European producers in 1990 (the last full year during which the infringement is known to have continued) amounted to almost 4,2 million tonnes, of which about one-sixth was exported to overseas markets.

Some 2 400 000 tonnes were produced in the Community, 70 % of which consisted of GD grades. The output of the Nordic countries was 1 300 000 tonnes (almost all GC and SBS) while in Austria some 340 000 tonnes of GD grades were manufactured.

West European (EC and EFTA) consumption of cartonboard (all grades) in 1990 was some 3,5 million tonnes. Of this total, GC grades accounted for 1,3 million tonnes (37 % by tonnage), GD grades 1,9 million tonnes (54 %) and SBS 0,3 million (9 %).

Cartonboard consumption in the Community in 1990 was some 3 090 000 tonnes, of which 1 150 000 tonnes were GC and 1 700 000 tonnes GD grades. France, Germany, Italy and the United Kingdom accounted for over 80 % of Community consumption.

Imports from EFTA countries, principally Sweden and Finland, took 30 % of the Community market.

Details of production, sales and consumption for 1990 are shown in Table 1.

The Community market for cartonboard was worth approximately ECU 2 500 million in 1990.

(6) The west European market for cartonboard over the past 30 years was characterized by strong growth. The annualized rate of growth in Europe for cartonboard was normally greater than that for industrial production in general: during the 1980s, for example, cartonboard growth in western Europe averaged 3 % annually compared with only 1,5 % growth in industrial production.

In the four-year period from 1987 to 1990 cartonboard consumption increased by 18,6 %. In 1991 however there was a downturn and demand fell by 2,2 %.

During the second half of the 1980s, demand for GC (virgin fibre) grades increased at almost three times the rate for GD (recycled) grades.

The trend to GC grades was reversed during 1990 with GD sales in the Community increasing by some 11 % over 1989, while GC sales fell by 1 %.

The significant switch back to GD in 1990 was attributed to several factors: greater public awareness of environmental concerns; an increase in the price differential between GC and GD grades in late 1989 when GC prices were increased but GD prices were not; and improvement in the appearance of some GD grades so as to make the product appear more like the GC grades.

3. The producers

(7) The Community market for cartonboard is supplied to a considerable extent by European producers of GC grades located outside the Community and particularly in Sweden and Finland.

The GC sector is...