French Parcel and Express sector fined heavily for price collusion

Details of another price fixing case have come to light, this time in the French parcel market. The French competition authority (Autorite de concurrence) has levied fines totalling €670.9m on a string of express and mail companies for collaborating on tariff setting. The decision concerning collusion is not new, however the size of the fines and the evidence behind the judgement is.

In a statement issued yesterday, the organisation said that it had fined “Alloin, BMVirolle, Chronopost, Exapaq (now France DPD) Ciblex Dachser France, DHL Express France, FedEx Express France, Gefco, Geodis, GLS France, Heppner, Lambert and Valletta XP France, Norbert Dentressangle Distribution, Normatrans, Jewel-Schenker, TNT Express France, Transport Henri Ducros, Ziegler France”. In addition, it has levied a fine on the trade association TLF.

The case against the accused was supported by two companies, Schenker-Jewel and Allion. They were bought by Schenker and Kuhne and Nagel respectively and it appears that the new owners approached the French authorities with evidence of collusion. Consequently, Schenker and Kuehne and Nagel received lighter fines.

The Autorite de concurrence stated that the collusion took place during meetings of the TLF trade association citing emails from the likes of Dachser, Mory and Geodis concerning discussions about tariffs. One means of doing this was to co-ordinate rate rises, entering into discussions with customers for a 7% rise rather than a 5% increase which some providers had originally planned to do. Similarly, diesel surcharge increases were controlled by agreeing a standardised approach across the participants of the cartel.

Geodis received the biggest fine at €196m followed by €99m for Chronopost. Some smaller providers had reductions in their fines due to their “financial difficulties”. This included Ciblex, Heppner, Lambert and Valletta, XP France, Henri Ducros Transport and Ziegler who had reductions of over 90% in the sums they would otherwise been obliged to pay.

Geodis has already stated that it will challenge the decision whilst others have said they are considering whether to appeal.