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Three egg-product companies fined for illegal price-fixing agreements

The Netherlands Authority for Consumers and Markets (ACM) has imposed fines on three companies that purchase eggs (Interovo, Wulro and Global) for concluding illegal price-fixing agreements with regard to the purchase of eggs from farmers that keep laying hens.

Martijn Snoep, Chairman of the Board of ACM, explains: “These companies concluded secret price-fixing agreements regarding the purchase price of eggs, and coordinated among themselves from which farmers they would purchase eggs. These actions have harmed the farmers. They ended up getting a lower price for their eggs. We take strict enforcement action against such buyer cartels.”

What was this case about?

Interovo, Wulro and Global purchase so-called industrial eggs from farmers. Industrial eggs are not the kinds of eggs that are sold in supermarkets, but which are used by the food-processing industry. The three companies process these industrial eggs into liquid egg products or powdered egg products, such as egg white and yolk. These egg products are used, for example, by sauce manufacturers and patisseries.

Illegal arrangements

Starting in April 2015, Wulro and Interovo had, for over a year, coordinated prices, shared suppliers, and exchanged competition-sensitive information. Wulro and Global had done the same for over three years starting in March 2016. The directors of these companies had regular contact with each other over WhatsApp about their arrangements and the purposes thereof. Here is an example of a WhatsApp message (the original messages are in Dutch):

A: “In this market, the status quo with customers and farmers is the best option. In that way, we will not be played off against each other, and we will finally be able to make some money.”

B: “Totally agree! I’ll drink to that.”

There are also conversations about what prices they had offered to or would offer to farmers. For example, one individual sent the following message: “For Easter, I managed to get Nop -0.10 from [X] and [Y], and everything that is offered from [the Nop price], I offer Nop -0.30 (…)”. The recipient responds: “Okay, I’ll do the same then”. In this context, minus -0.10 or -0.30 refers to the discount off the price that the Dutch Organization of Poultry Farmers (NOP) sets as the recommended price.

In another conversation, companies share farmers among themselves:

E: “[F], is [Z] a customer of yours?”

F: “Yes, for feed and eggs”

E: “Ok, [those] are offered here by [company]”

F: “Please ignore them”

E: “I certainly will then!”

Serious violation of the competition rules

ACM believes that these activities constitute serious violations that harm farmers. Interovo is fined [x]* euros, Global is fined [x]* euros, and Wulro is fined [x]* euros.

ACM and competition oversight

ACM ensures that markets work well for people and businesses. That is why ACM makes sure that businesses compete fairly. Businesses that conclude secret price-fixing agreements, market-sharing agreements, or that exchange competition-sensitive information are liable to punishment. These kinds of agreements lead to higher prices, reduced quality, and less innovation. In its oversight, ACM also uses tip-offs and other reports about possible violations. That was also what had prompted this case. If you wish to file a report: contact us.

* On May 8, 2023, the court held in a preliminary injunction that, for now, no fines and calculation methods may be published. For more information, see below.

See also