France's competition authority has issued a total of €93 million in fines to 12 food-processing companies for attempting to fix prices for ham, sausage, and other cold cuts sold under private label in French supermarkets.

The judgment, handed down by France's Autorité de la Concurrence, highlights that even if companies conspire to fix prices but in the end are not successful, it is still illegal.

The companies involved include international food giant, Nestlé; a supplier to one of the biggest hypermarket chains in France, Intermarché; and some of the best-known names in the charcuterie aisle, such as Fleury Michon, Paul Prédault and Aoste, according to the judgment.

The conspiracy ran from 2011 and 2013 and was both upstream and downstream, according to the authority, with companies attempting to fix the price paid to slaughterhouses for unprocessed pork as well as the price charged to retailers for the finished products.

In the end, though, the slaughterhouses and the retailers had sufficient negotiating power to push back on the food processors' demands, the authority said.

"The competition authority is making a statement: We're going after every cartel, whether or not there was damage to the economy," said Natasha Tardif, a competition partner at Reed Smith in Paris.

Cold cuts are a €6.7 billion business in France, according to industry figures cited by the authority. The companies involved control some 78% of the market for private-label charcuterie, the authority said in its judgment.

The judgment includes one of the highest total fines for food-related price-fixing in France – surprising in light of the finding that the cartel did not affect prices, competition lawyers told Law.com International.

But the fine would have been larger if not for some mitigating factors, such as the fragile financial condition of some of the companies, said Marc Lévy, a competition partner at Reed Smith in Paris.

"There will probably be more cases like this in the future, as companies struggle and seek every advantage in order to survive," Lévy said.

Camille Paulhac, head of the competition practice at Paul Hastings in Paris, added that consumer-goods cases – "anything involving things people buy on a daily basis" – were a high priority for scrutiny by the French competition authority.

The text of the judgment is notable for the amount of granular detail it contains on how the companies conducted the scheme.

There were weekly phone calls, "usually on Thursday afternoons or Friday mornings," to adopt a common negotiating position with the slaughterhouses; real-time updates on negotiations via text messaging; and clandestine meetings in Ibis hotels in Paris and Lyon to coordinate price demands to the retailers.

Much of that detail was provided by an informant at one of the companies, who turned over a spiral-bound notebook full of evidence in 2012 under a new French whistleblower law. The law, passed in 2011, provides for leniency for conspirators who cooperate with an investigation.

In this case, though, the competition authority fined the whistleblower's company anyway because the company continued to participate in the cartel even after turning over the evidence.

Several of the companies have indicated that they will appeal the judgment. Lévy and Tardif said that in the past, French courts have tended to uphold antitrust judgments but reduce the size of the fines, especially if the companies can show financial distress.

The reputational distress, however, is another thing.

"Companies take being named as being part of a cartel very seriously, regardless of the fine," Tardif said.

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