20 Feb 2007
Royal Dutch Shell Plc, Dow Chemical Co., and two other companies are appealing European Union fines levied against them for fixing prices of synthetic rubber.
Shell, Europe’s biggest oil company, and Dow, the largest US chemicals maker, were among five companies fined €519 million ($682 million) by EU regulators in November for colluding to rig prices of rubber ingredients used in tires and shoes. EU Competition Commissioner Neelie Kroes, who has made cartel-busting one of her top priorities, levied a record €1.84 billion in fines on seven cartels last year. Eni SpA, Europe’s fourth-biggest oil company, received the largest penalty of €272.2 million for the rubber cartel. Shell was fined €160.9 million and Dow €64.6 million. Shell and Dow filed appeals February 16 with the European Court of First Instance in Luxembourg, the EU’s second-highest court, according to Sarah Smallhorn, a London-based spokeswoman at Shell, and Dow spokeswoman Alexandra von Holzing. A ruling could take as long as three years, Von Holzing said.
Eni plans to file its appeal soon, probably tomorrow, Mario Siragusa, a lawyer for the Rome-based company, said in a telephone interview yesterday. Shell and Eni had their fines raised for being repeat offenders, while Bayer AG was exempt because it tipped off the regulator about the cartel. Poland’s Trade-Stomil Sp z o.o. was fined €3.8 million. Unipetrol AS, the Czech Republic’s biggest oil company, and its rubber-making subsidiary Kaucuk filed an appeal on February 17 against the €17.5 million fine they were given for colluding in the cartel, according to spokeswoman Michaela Lagronova. Unipetrol is controlled by Polish oil company PKN Orlen SA. The November cartel decision focused on two synthetic rubber products, called styrene butadiene and emulsion styrene butadiene, which are used in production of tires, footwear, conveyor belts, hoses and flooring. The conspiracy to lift prices of the chemicals ran from at least 1996 to 2002, the commission said. (Bloomberg)
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