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Fines for Price-Fixing to Remain within the EC; Saint-Gobain Expects Auto Glass Sanction

The European Commission (EC) fined four glass manufacturing companies—Asahi Glass Co., Guardian Industries, Pilkington (part of the NSG Group) and Saint-Gobain— EUR 486.9 million (approximately USD 719.2 million) for price-fixing on November 28 (CLICK HERE to read related article).

According to the EC's statement the fines were imposed because the companies "coordinated price increases and other commercial conditions for deliveries of flat glass used for windows, glass doors and mirrors within the European Economic Area."

Since the announcement, questions have surfaced as to where the money, once collected from the manufacturers, will go? Will, for example, it be distributed back to customers?

According to Mattias Sundholm, acting spokesperson/acting head, press and public diplomacy for the Delegation of the European Commission to the U.S., the money stays within the EC.

"All fines levied on cartel cases go into the EC budget," says Sundholm, "thereby reducing member state contributions and ultimately benefitting tax payers."

In addition, information on the EC's website states: "Any person or firm affected by anti-competitive behavior as described in this case may bring the matter before the courts of the member states and seek damages, submitting elements of the published decision as evidence that the behavior took place and was illegal. Even though the Commission has fined the companies concerned, damages may be awarded without these being reduced on account of the commission fine."

According to Sophie Chevallon, exterior communications director of Saint-Gobain, Saint-Gobain expects another fine from the EC either at the end of the first quarter or beginning of second quarter 2008 regarding its auto glass division.

"The sanction could be a lot higher than this one," Chevallon says, explaining that the period of time being investigated is longer for the automotive glass case than it was for flat glass.

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