The European Commission (EC) has fined 15 major automakers and the European Automobile Manufacturers’ Association (ACEA) a total of €458 million ($494 million) in connection to a long-standing cartel involving the recycling of End-of-Life Vehicles (ELVs). EU fines automakers for their role in this cartel. The EC’s investigation, supported by the UK government, uncovered that these companies colluded for over 15 years to manipulate the ELV recycling market.
EU Fines for Anti-Competitive Practices
The EC fined the automakers and ACEA for engaging in anti-competitive practices. The companies agreed not to pay car dismantlers for their services. They opted for a “Zero-Treatment-Cost” strategy, assuming ELV recycling would be profitable enough to avoid paying for dismantling services.
The investigation also revealed that the companies shared sensitive information about their agreements with dismantlers. They coordinated their actions to limit competition. Additionally, the companies agreed not to disclose how much of an ELV could be recycled, recovered, or reused. This was to prevent consumers from considering recycling as a factor when choosing cars.
Largest Fines Imposed
Volkswagen received the largest penalty, totaling €137.8 million. Renault/Nissan was fined €87.9 million, and Stellantis was penalized €80.9 million. Mercedes-Benz avoided fines after revealing the cartel’s existence under the leniency program. All other companies admitted their involvement and settled the case.
The EC’s investigation timeline shows the collusion began in 2002. More companies joined between 2006 and 2010. The cartel ended in 2017, but it significantly damaged fair competition in the ELV recycling market.
European Commission’s Response
Teresa Ribera, EC Executive Vice President for Clean, Just, and Competitive Transition, stressed the need for high-quality recycling in key industries like automotive. She pointed out that recycling plays a crucial role in achieving a circular economy. It also helps reduce waste, emissions, and production costs while creating a more sustainable industrial model.
In response to the fines, the EC proposed funding for electric vehicle (EV) recharging infrastructure. Additionally, the EC initiated a fact-finding exercise on how European companies procure and recycle critical raw materials for EV production.
Legal Requirements and Compliance
Under EU Directive 2000/53/EC on ELVs, car manufacturers must cover the disposal costs. They must also ensure that consumers are informed about the recycling performance of new vehicles. The investigation revealed that ACEA facilitated meetings between automakers to advance the cartel’s goals. EU fines automakers for their involvement in these anti-competitive practices.
The fines highlight the EU’s commitment to preventing anti-competitive behavior and fostering fair practices in industries affecting both the environment and consumers.
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