Eu commission intensifies antitrust investigation into building materials and chemicals cartel

On July 20, the European Commission issued a preliminary investigation opinion, identifying several construction chemicals manufacturers and three national industry associations suspected of violating EU antitrust regulations by colluding to raise the prices of chemical additives for cement, concrete, and mortar.

On July 20, the European Commission served a Statement of Objections on the relevant producers in France, Germany, and Spain, as well as three industry associations, setting out its preliminary findings in the investigation into the suspected cartel in the construction chemicals sector.

The Commission stated that the company involved and the industry association may submit written defenses regarding the points of concern in the investigation; it also emphasized that the issuance of the “Statement of Objection” does not mean that this investigation has reached a final conclusion.

The products subject to this investigation are mainly chemical additives for cement, as well as admixtures for concrete and mortar. The European Commission stated that cement, concrete, and mortar are core raw materials for infrastructure, and that the prices of upstream chemical additives directly affect overall construction costs.

In October 2023, the European Commission conducted surprise inspections at the offices of construction chemicals companies in several EU Member States to gather on-site evidence. According to the Commission’s announcement, preliminary findings indicated that between 2021 and 2022, amid the dual impact of the COVID-19 pandemic and the Russia-Ukraine conflict, raw material costs rose sharply, and relevant producers allegedly took the opportunity to coordinate and discuss plans to increase prices for additives. The suspected collusive conduct was carried out through national industry associations, which jointly drafted external press releases and used the publication of such announcements to create a plausible justification for collective price increases.

This investigation has verified three separate suspected antitrust violations in France, Germany, and Spain. The companies that received the notice of objections include Sika AG, Cemex, Chryso, Mapei SpA, Master Builders Solutions, MC Bauchemie Müller, TAM, Ha-be, Liesen, and Remei. The three industry associations that also received the notice are France’s Synad, Germany’s Deutsche Bauchemie, and Spain’s Anfah.

The European Commission stated that if the relevant companies are subsequently formally found to have engaged in illegal monopolistic conduct, such conduct would violate EU competition rules prohibiting cartels. Once sufficient evidence of violations is obtained, the Commission may issue a penalty decision: ordering the companies to cease the relevant illegal practices and imposing fines of up to 10% of the companies’ global annual turnover.