NMa confirms dawn raids at undertakings in fruit and vegetable industry

The Netherlands Competition Authority (NMa) has confirmed that it has carried out dawn raids this week at eight undertakings specialized in selling fruit and vegetables. In addition, a large number of undertakings in the industry have received a letter from the NMa in which they are requested to provide further information.

The NMa carries out dawn raids when it suspects the Dutch Competition Act is violated, for example, by price-fixing agreements, or by market sharing agreements. Purpose of these dawn raids is to collect information in order to determine whether the Act is indeed violated or not. Around 65 NMa officials were involved in the aforementioned raids.

Simultaneously to the raids carried out by the NMa, the Belgian Competition Authority has also carried out dawn raids this week in the same industry in Belgium. All these raids are carried out under each authority's own powers and responsibilities.

With an annual total turnover of more than €12 billion, the economic significance of this industry is enormous. As already mentioned in the NMa Agenda 2008-2009, the food and agricultural industry is an important area of attention for the NMa, since the market structures of many cooperative arrangements in this industry bring with them an increased risk of collusion between undertakings with regard to prices and volumes.

The fact that the NMa has carried out these dawn raids does not automatically mean that the companies concerned are guilty of anti-competitive behavior, and therefore does not prejudge the possible outcome of the investigation. Apart from examining the behaviors of the undertakings, the investigation also looks into possible involvement of natural persons.

The investigation's procedure is as follows: should the NMa's investigation lead to the conclusion that there is indeed a reasonable presumption of a violation of the Competition Act, the NMa will draw up a report against the undertakings involved and/or the natural persons involved. In that case, the undertaking or natural person has the opportunity to defend itself/himself, both in writing or orally (in a hearing). Once the parties involved have been heard, the NMa will decide whether the presumed violation can be established as fact, and, if so, what sanction should be imposed on the undertakings or natural persons involved. These sanctions can be as high as ten per cent of the global turnover for undertakings, or €450,000 for natural persons.

The NMa cannot comment on the estimated length of the current investigation. In general, the length of an investigation depends on various factors, such as the complexity of the case, as well as the level of cooperation of the undertakings involved.

Apply for leniency
Under the NMa's leniency program, cartel participants may be eligible for fine reduction. In addition, cartel facilitators or natural persons that have been involved in a cartel can also apply for leniency. More information on the NMa's leniency program can be found online at: acm.nl

Indications and tip-offs
Indications and tip-offs that the NMa receives from individuals and undertakings concerning possible violations of the Dutch Competition Act, and preferably accompanied by supporting evidence, are highly appreciated. It is these indications and tip-offs that enable the NMa to increase its knowledge of a certain industry, and to track down possible violations. The NMa annually receives approximately 4,000 indications concerning possible violations of the Competition Act. More information on how to tip off the NMa or to report a violation can be found online at: acm.nl.