Eni SpA, Italy's largest oil company, a joint venture of Dow Chemical Co. and DuPont Co., and two rivals were fined a total of 243 million euros ($358 million) by European Union regulators for fixing the price of a synthetic rubber used to make diving equipment, shoe soles and condoms.
The European Commission, the EU's antitrust regulator, fined Eni 132.2 million euros, DuPont and Dow a combined 59.3 million euros, Japan's Denki Kagaku Kogyo KK 47 million euros and Japan's Tosoh Corp. 4.8 million euros. It's the third time the commission has fined companies for fixing the prices of chemicals used to make rubber.
``It is particularly disappointing that the rubber industry has still not learned its lessons about avoiding cartels,'' EU Competition Commissioner Neelie Kroes said in a statement today in Brussels. ``I find it very difficult to understand how shareholders and board members can tolerate such illegal behavior.''
The commission, the EU's antitrust authority, fined Dow and four competitors a total of 519 million euros in November 2006 over another rubber chemical cartel. Dow, based in Midland, Michigan, is appealing its 64.6 million-euro portion of that penalty to an EU court.
Eni's fine was increased by 60 percent because it was a repeat offender, the commission said. A spokeswoman for Rome- based Eni, who declined to be identified, said the company couldn't immediately comment.
Bayer Immunity
Bayer AG, Germany's largest drugmaker, was given full immunity from the penalties because it was the whistle blower. The company would have been fined 201 million euros.
In March, the commission charged the chemical makers, including DuPont and Dow's DuPont Dow Elastomers LLC joint venture, with breaking antitrust rules.
A DuPont spokesman wasn't immediately available to comment.
``We will examine the decision by the EU and will take an appropriate action,'' said Etsuya Ikeda, a spokesman for Tosho.
Wilmington, Delaware-based DuPont increased its reserves for legal expenses in the case by $52 million in the first quarter. The company expects Dow to contribute $13 million, bringing the total increase to $65 million, DuPont said in a filing with the U.S. Securities and Exchange Commission. DuPont's reserve for legal expenses was $174 million as of Sept. 30, the company said.
Dow transferred its stake in the joint venture to DuPont in 2005. The venture was renamed DuPont Performance Elastomers LLC.
source:bloomberg.com
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