Commission Fines UPM over Bag Cartel

The European Commission has imposed fines totalling 216 million euros on 16 companies it has accused of forming a cartel in the market of plastic industrial bags. One of those fined is the Finnish forest industry company UPM, which was ordered to pay nearly 57 million euros.

The European Commission said that the antitrust violation was a serious one, and sees the size of the fines as an indication that it is determined to act against cartels.

The fine imposed on UPM was the heaviest of all of the companies involved in the case. UPM says that it will review the Commission's ruling and consider possible further action.

According to the commission, the companies involved in the cartel agreed amongst themselves on fixed sales prices and regional quotas. They also made uniform bids for contracts, and maintained a system of exchanging information on sales.

"Cartels are the worst obstacle to competition and I intend to penalise firms that operate them and so jeopardise the very basis of our market economy and harm consumers," said Neelie Kroes, the European Commissioner for Competition.

Plastic industrial bags are used to pack various products, mainly of an industrial nature, but also products destined for consumers, such as raw materials, fertilizer, agricultural products, animal feed and building materials.