The Romanian Competition Council has sanctioned 21 companies with fines totaling RON 83.2 million (EUR 15.87 million) for participating in anti-competitive agreements to fix prices on the markets for the production and/or sale of crop seeds and crop protection products in Romania.
Following its investigation, the competition authority found that each of the producers Pioneer Hi-Bred România S.R.L., Corteva Crop Solutions ROM S.R.L. (formerly DuPont Romania S.R.L.) and Maisadour Semences România S.R.L. had reached an agreement with its distributors regarding the conditions under which they could sell or resell crop seeds and/or crop protection products. Specifically, the producers and distributors established, through contractual provisions and/or a voucher system, the resale prices to the distributors’ customers, namely farmers, for certain products marketed as part of agricultural campaigns.
Under the voucher system, producers provided farmers directly with vouchers containing the eligible products and the discounts offered, while farmers could choose the distributor from which to purchase the products. However, the final price at which the farmer purchased the products using the voucher had been previously agreed between the producer and the distributor.
“We are not opposed to the voucher system, but the price recommended by the producer must not, in practice, turn into a fixed, i.e. mandatory, price. Distributors must independently set their resale prices for farmers, who will thus fully benefit from competition between distributors through more advantageous prices and additional discounts. Companies can contact the Competition Council at any time for guidance on the proper application of the relevant legislation,” said Bogdan Chirițoiu, President of the Competition Council.
Through this mechanism, producers were able to influence the level of prices charged on the market, while distributors benefited from a more predictable volume of sales and, in some cases, discounts for participating in the campaign.
The fines were imposed as follows:
• Pioneer – RON 14,470,239
• Corteva – RON 6,322,488
• Maisadour – RON 1,375,751
• Agrii – RON 17,899,228
• Agro-Est – RON 699,242
• Agroind – RON 3,503,158
• Agrotex – RON 2,262,866
• Alcedo – RON 4,651,096
• Ameropa – RON 4,464,529
• Biochem – RON 418,249
• Chemark – RON 782,354
• Diva Sol – RON 1,985,311
• Fertiagro – RON 1,161,761
• First Grain – RON 1,438,298
• Kwizda – RON 3,450,893
• Medicago – RON 2,067,990
• Merpano – RON 3,245,875
• Moldova Farming Agricultura, Moldova Farming Nord and Comfert Agricultura (as entities benefiting from the demerger of Moldova Farming SRL) – RON 1,621,839
• Plantagro – RON 2,426,166
• Promat – RON 5,415,690
• Rodbun – RON 3,540,349
Agricover applied for the leniency programme and was granted immunity from the fine.
In addition, 15 of the 21 sanctioned companies acknowledged the infringement of the Competition Law and, as a result, benefited from reductions in their fines. The companies that acknowledged the anti-competitive practices are: Pioneer, Corteva, Maisadour, Agroind, Agrotex, Alcedo, Ameropa, Biochem, Chemark, Divasol, Firstgrain, Kwizda, Moldova Farming, Promat and Rodbun.
The producers were more heavily involved, as they initiated the price-fixing mechanism. For this reason, when determining the fines, higher percentages of turnover were applied than those applied to distributors, most of which are local companies.
With regard to the relationship between Monsanto România S.R.L. and its distributors, the competition authority did not identify sufficient evidence to establish that the prices recommended by the producer had operated as fixed (mandatory) prices for the resale of crop seeds to farmers as a result of an anti-competitive agreement.
The decisions of the Competition Council are enforceable, and the fines imposed constitute revenue to the state budget. The National Agency for Fiscal Administration (ANAF) implements the competition authority’s sanctioning decision and enforces the fines.
The Competition Council’s decision will be published on the institution’s website after confidential information has been removed. Source: Romanian Competition Council
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