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Johannesburg - Sasol (SOL), the world's largest
fuel from coal producer, is among nine firms that were on Wednesday fined a total of €676m euros or R7.9bn by Europe's antitrust watchdog the European Commission (EC) for participating in a paraffin wax cartel.
"Sasol's fine was increased by 50% because it was the leader of the cartel," the EC said in a statement.
According to the document, Sasol will have to pay the largest fine of €318.2m or R3.7bn.
The other producers are Shell in UK and Netherlands, Spain's Repsol, the US's ExxonMobil, Italy's ENI, German company Tudapetrol, Hansen & Rosenthal, Hungary's MOL, German company RWE and France's Total.
Calling the cartel the "paraffin mafia", the European Union's Competition Commission found that from 1992 to 2005, the producers of paraffin waxes and slack wax "operated a cartel in which they fixed prices for paraffin waxes".
"ExxonMobil, MOL, Repsol, Sasol, Shell and Total also engaged in market allocation for this product and ExxonMobil, Sasol, Shell, RWE and Total also fixed prices for slack wax sold to end-customers on the German market," the EC said in its official notice of its findings.
It said the companies held regular meetings to discuss prices, allocate markets and/or customers and to exchange sensitive commercial information.
The cartel constitutes "a very serious infringement of EC Treaty antitrust rules" and in setting the fines, the commission took into account the respective affected sales of the companies involved as well as the combined market share and the geographical scope of the cartel agreements.
"There is probably not a household or company in Europe that has not bought products affected by this 'paraffin mafia' cartel, with all that implies in terms of paying over the odds, higher costs and economic damage," said Competition Commissioner Neelie Kroes.
"Such illegal cartel behaviour cannot and will not be tolerated by the commission, and companies' managers and shareholders should take note," he said.
The EC said cooperation with the investigation of three groups under the commission's leniency programme was also rewarded.
Sasol, Repsol and ExxonMobil were granted a reduction of their fines of 50%, 25% and 7% respectively, it said.
- I-Net Bridge