COMPETITION / CARTELS : EU COURT CUTS BASF AND DAIICHI'S VITAMIN CARTEL FINES.

Vitamin manufacturers BASF and Daiichi Pharmaceutical on 15 March won a reduction on fines imposed by the European Commission following cartel action in November 2001 - but the total fine in the vitamin case remains the largest ever levied in anti-cartel enforcement.

The Commission fined the pair after deciding in 2001 that they were involved in cartels in 12 different vitamin markets along with several other companies. German chemicals giant BASF was fined a total of 296.16 million, whilst Japanese Daiichi was hit for 23.4 million for its part - together with BASF and Hoffmann-La Roche - in a cartel rigging the vitamin B market.

The two companies appealed to the Court of First Instance (CFI) asking it to overturn the Commission's Decision or reduce the fines. The CFI rejected the majority of BASF and Daiichi's arguments but found that some of the fines should be reduced because the Commission committed errors when applying them.

BASF NOT ALWAYS CARTEL LEADER

The CFI held that the Commission's decision to raise fines on BASF for its involvement in the vitamins C and D cartels was wrong, since BASF was not the leader or instigator of the cartels. The Commission had raised its fines against BASF in these cartels by 35% on the grounds of aggravated circumstances'. The Court also reduced fines applied to BASF for its involvement in the beta-carotene and carotinoids cartels. It decided that under the Leniency Notice the company was entitled to reductions since it was the first to provide the Commission with decisive evidence of the existence of these cartels.

Daiichi benefited at the time of its original fine from a reduction of 35% as a result of provisions in the Leniency Notice. However the CFI held that the reduction should be increased to the maximum allowable under the relevant part of the notice (50%) to acknowledge the importance of Daiichi's cooperation with the Commission, which the Court said had been underestimated.

The final fine on BASF was reduced by 59.3 million to 236.845 million; Daiichi's fine fell by 5.4 million to 18 million.

A Commission spokesman welcomed the ruling, saying it confirmed that the bulk of the Commission's original Decision was right and rejected BASF and Daiichi's arguments. He said: "The decision confirmed the existence of an infringement and approved the...