French yoghurt cartel members receive huge fines

French competition authorities have slapped a €192.7m (£137.3m) fine on eleven dairy firms for operating a price fixing cartel.

The cartel was found guilty by competition watchdog Autorité de la Concurrence of colluding to fix the price of supermarket own-label dairy products including yoghurt, crème fraiche and dairy desserts between 2006 and 2012.

Producers Yoplait, Lactalis, Senagral  and Novandie acted as ringleaders, according to the Autorité, however Yoplait escaped a €44.7m fine for blowing the whistle on the cartel in the period after it was bought by US food giant General Mills in 2011.

Senagral, which had faced an initial €101.3m fine, also benefitted from a reduced sanction for participating in the whistleblowing, while Lactalis Nestle was hit with a €56.1m sanction. The eleven producers implicated by the investigation represented some 90% of the total French market for own-label dairy desserts.

A statement published by the Autorité de la Concurrence said executives would meet regularly in cafés, hotel rooms and even the Parisian apartment of the director general of Novandie, where they would “continue the conversation and smoke a cigarette”.

Competitors would inform each other of any price rises made and reached agreement on any rises they wanted to announce to distributors and the arguments to justify them, claimed the statement.

Telephone conversations also took place using secret mobile phones, with Senoble’s representative registering the account in a “companion’s” name to avoid detection. However, the Yoplait representative kept a secret file on the cartel and submitted the file to the Autorité when it applied for leniency.

The cartel was guilty of “serious anti-competitive practices that distorted the operation of the market over several years”, the competition watchdog said.

“The fines were proportional to the seriousness of the events, and the extent of the loss caused to the economy,” it added.