Vitamin makers admit price-fixing conspiracy

Click to follow
The Independent Online
SIX BIG vitamin manufacturers agreed to pay $1.1bn (pounds 688m) in a price-fixing lawsuit that could benefit British consumers.

The landmark settlement is intended to conclude an action brought in America against the companies, alleging that they took part in a nine- year conspiracy to fix wholesale prices.

It was claimed the conspiracy led to artificially high prices for hundreds of food and beverage manufacturers, including Coca-Cola, General Mills and Kraft Foods.

In two weeks the agreement will be presented to Judge Thomas Hogan, of the US District Court for the District of Columbia, to determine the fairness of the settlement, The Washington Post reported.

The six companies, which include Roche of Switzerland, BASF of Germany and Rhone-Poulenc of France, control 80 per cent of the market for the most popular vitamins, including A, C and E.

British consumer organisations said the settlement could reduce prices of some food and drinks. "All products that have vitamin supplements in them will have been affected," said Phil Evans, senior policy researcher at the Consumers' Association. "If companies are price-fixing in America, where the law is tougher, then the British Government and the European Commission should be looking at whether it is happening here.

"How much consumers will benefit will depend on how much competition there is for the particular product. If Coca- Cola see their costs cut by 1 or 2 per cent because of cheaper vitamins, then, because of the competitive market they are in, there is no reason why they would not pass it on to the consumer," he said.

The deal is the latest in a number of financial setbacks for the world's leading vitamin manufacturers. In May the US government fined Roche and BASF $500m and $225m respectively for conspiring to fix the price of vitamins. The companies had eventually admitted their guilt to the anti-trust division of the US Department of Justice.

Officials alleged that in meetings at hotels and homes around the world, the companies had colluded to divide up markets and set vitamin prices.

The companies refused to confirm the latest settlement. Roche Holding said that talks on settling civil lawsuits arising from a US vitamins price-fixing case were making good progress but it would not confirm a tentative accord had been struck.

"The settlement discussions are well advanced. We are hopeful of making a settlement," a company spokesman said. "I cannot confirm the timelines or the amounts mentioned."