Dawn raids were carried out on the offices of Pilkington, Saint-Gobain and Glaverbel (Asahi) in six European countries by the European Commission’s anti-trust officials on 22 and 23 February, as part of a probe into coordinated prices and surcharges.

The ‘energy surcharge’ introduced by Pilkington last year on flat glass in response to high oil prices is under investigation for being a coordinated move. Car windscreens is another area under investigation. Guardian, which joined the flat glass market as recently in 1971, has operated a surcharge in the US for years and became the second to levy a surcharge in the UK. It will also be investigated. It will be 18 months before the outcome is known.

Companies that are found to have violated EU competition rules by operating a cartel are liable to fines of up to 10 per cent of their annual worldwide turnover but usually escape with lower penalties. Fines are accompanied with an imposed return to earlier prices.

The largest fine against a single company has been 497 million euros ($658 m) levied against Microsoft in 2004.

Comment

Price fixing is an easy accusation to make – glass production has huge barriers to entry, four manufacturers supply much of Europe, and in the past, the manufacturers have not been without blemish. However, the price of float glass is so low that the energy surcharge has been received as necessary and transparent. Aside from value-added coated glasses, float is destined to become a commodity.

Source

Glass Age