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French fine logistics companies €672 million

PARIS: December 15, 2015. L'Autorité de la concurrence, France's Competition Authority (FCA) has fined 20 logistics companies and their trade association, L'Union des Entreprises de Transport et de Logistique de France (TLF), a total of €672 million for alleged price fixing between September 2004 and 2010.

Express finesIn announcing its decision, the FCA claimed the companies met regularly at the TLF to agree prices they would charge their customers: "The discussions were secret and were not subject to any official record," it said, adding that "instead of playing its role of vigilance in compliance with competition rules, [the TLF was] actively involved in the organization of illicit trade and the protection of confidentiality."

The companies fined by the FCA are: Alloin, BMVirolle, Chronopost, Exapaq (now France DPD) Ciblex Dachser France, DHL Express France, FedEx Express France, Gefco, Geodis, GLS France, Heppner, Lambert and Valletta XP France, Norbert Dentressangle Distribution, Normatrans, Jewel-Schenker, TNT Express France, Transport Henri Ducros and Ziegler France.

Geodis topped the list of fines at over €196 million followed by Chronopost with €99 million and DHL Express France at €81 million.

In calculating penalties, the FCA said it had taken into account behavior duration, severity and the damage caused to the French economy - particularly SMEs which it said were the main "victims" of the alleged price fixing.

The TLF responded saying the fines, 10 years after the fact, were "particularly heavy" and didn't reflect the possible damage done to the market. It added that because of declining prices and revenue over the past 15 years, bankruptcies in the logistics sector have multiplied with more than 15,000 jobs lost.

Noting that large companies will be able to survive the fines and the two unnamed whistleblowers will gain a competitive advantage, the TLF concluded "SME's will come out very weakened [and] penalties imposed today will further exacerbate the structural crisis facing the industry."

In a statement, TNT said it had been ordered to pay €58 million for "alleged anti-competitive behaviour in the French parcel delivery sector". The company, which is due to merge with FedEx Corp. next year, said the case relates to activities that took place before 2010 and it had cooperated with the FCA to reach a settlement during the third quarter of 2014. TNT added it would review the merits of today's decision.

Kuehne + Nagel (K+N) has also responded to the FCA fine of the Alloin Group, a groupage operation it acquired in 2009. K+N said €31 million of the €32 million penalty (see table) is attributable to the period before it purchased Alloin: "Kuehne + Nagel dissociates itself from such business practises, has a comprehensive compliance programme in place, which is continuously improving, and has been cooperating with the French Competition Authority since 2010," it declared. The company added it is considering an appeal and possible action against the Alloin family, the previous owners.

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