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The EU Fines Mondelez Billions of CZK

Translated by Milo Dvorak

30. 5. 2024

Good morning,

It appears that for years, one of the world's largest biscuit and chocolate sweets producers, Mondelez, had been breaking bad, abusing their dominant market position. But the EU has cracked down on them, charging them a pretty hefty fine.

Published by on 23 May 2024.

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The American food company Mondelez International has been fined 337.5 million euros (8.3 billion CZK) by the European Union. This was announced by the European Commission (EC), which stated that the company had obstructed the trade of chocolate, biscuits and coffee between member states. By doing so, it abused its dominant position, violating the EU's competition rules. The territorial restrictions on supplies represent non-regulatory barriers that hinder the proper functioning of the single market, the EC added.

Following the announcement of the fine, Mondelez commented that the EU case pertained to past and isolated cases, most of which had been already resolved or remedied well before the Commission's investigation. “This historical issue does not represent who we are or the compliance culture we strive for,” the company stated according to Reuters.

Mondelez is headquartered in the USA and is one of the world's largest producers of chocolate and biscuits. Its brands include Côte d'Or, Milka, Oreo, Ritz, Toblerone, and TUC. Until 2015, it had also owned coffee brands HAG, Jacobs, and Velours Noir. Mondelez has been operating in the Czech Republic and Slovakia since 1992, where it has five production plants and employs 2,900 people. In these markets, the company owns brands such as Opavia, BeBe Dobré ráno, Brumík, Fidorka, Figaro, Miňonky, and Tatranky.

Company Imposed Higher Export Prices

“The illegal practices of Mondelez prevented retailers in member states from freely sourcing products at lower prices, thereby artificially segmenting the internal market,” described the European Commission. These illegal practices enabled the company to continue charging higher prices for its products, ultimately harming consumers in the Union, the Commission noted. The Commission is the EU's executive body with extensive powers who also serves as the antitrust authority.

The Commission began investigating the company in January 2021. It found that the company was involved in 22 agreements violating competition laws. One of these agreements required the company’s customers to charge higher prices for exports than for domestic sales. The agreements and illegal practices took place from 2006 to 2020 and affected all EU markets.

The fine was initially set to be even higher. However, since the company cooperated with the EC and explicitly acknowledged its responsibility, the fine was reduced by fifteen per cent.

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