EU fines wax cartel 676 mln euros for alleged price-fixing

BRUSSELS, Oct. 1 (Xinhua) -- The European Commission decided Wednesday to fine energy giants ExxonMobil, Total and eight others 676 million euros (960 million U.S. dollars) for their alleged price-fixing of paraffin wax used in candles and waxed paper.

European Union (EU) Competition Commissioner Neelie Kroes described it as a "major" case. The fine ranks the fourth largest ever imposed by the EU against price-fixing cartels.

The Commission said the illegal cartel existed between 1992 and 2005 and affected 75 percent of European markets.

Among the ten companies involved, Shell of the Netherlands was fully exempted because it revealed the existence of the cartel to the Commission, while the infringement committed by ExxonMobil, Sasol, Shell and Total also related to slack wax sold to end-customers on the German market.

Slack wax is the raw material used to produce paraffin wax. Paraffin waxes are used in a wide variety of products such as candles, waxed paper, tires and car components as well as in the rubber and packaging.

"There is probably not a household or company in Europe that has not bought products affected by this 'paraffin mafia' cartel, with all that implies in terms of paying over the odds, higher costs and economic damage," Kroes said, "Such illegal cartel behavior cannot and will not be tolerated by the Commission, and companies' managers and shareholders should take note."

The Commission investigation started with surprise inspections in April 2005, prompted by an application for immunity lodged by Shell.

The investigation found the companies held regular meetings to discuss prices, allocate markets and customers and to exchange sensitive commercial information.

In the Shell group, the cartel was called "paraffin mafia" and in the Sasol group "blue saloon."