French steel groups fined record €575m for cartel

Steel firms hit by record fine in France.
French competition regulators on Tuesday slapped a record fine of 575 million euros on giant ArcelorMittal and 10 other steel firms found guilty of price-fixing. Topping the list of offenders, three subsidiaries of ArcelorMittal, the world's biggest steelmaker, were ordered to pay 301.7 million euros followed by KDI, a subsidiary of the German group Kloeckner, fined 169.3 million euros. It was the biggest fine imposed by the French competition council since its creation in 1986, following a half-billion-euro fine handed down to mobile telephone operators in 2005. Thousands of construction, shipping and boilerwork companies were affected by the price-fixing scam, which is estimated to have cost the economy hundreds of millions of euros between 1999 and 2005, according to regulators. The ArcelorMittal subsidiaries rapped in the case were PUM Service Acier - ordered to pay 288 million euros - ArcelorProfil which was fined 12.95 million euros and AMD Sud Ouest with 830,000 euros. Lyon-based Descours et Cabaud was also ordered to pay 82.5 million euros for taking part in the scam, which ran over a six-period from 1999 to 2005. French companies Marc Morel and Maisonneuve were fined 12 and eight million euros respectively, while Clisson Metal was fined 800,000 euros, Liametho and CODIP 400,000 each and Ferren Fers 100,000 euros, while a French steel union was fined 124,500. Competition authorities launched an investigation in 2005 after the French economy ministry was tipped off about striking similarities in the price of a range of steel products such as bars and beams. It found the offending companies to have fixed prices for 70 to 90 per cent of all such products sold in France, as well as colluding to divide up their client base, and prevent new competitors from breaking into the market. The three ArcelorMittal subsidiaries, KDI and FFDM, saw their fine reduced after pledging to combat such practices in future, while Descours et Cabaud was handed a reduced fine after agreeing to cooperate with the probe.