Chairman Pecina cuts cartel fine for Czech bakeries to 52.8m CZK

21 Aug 2006

The Chairman of the Office for the Protection of Competition Martin Pecina issued a second-instance decision in which he had reduced a fine imposed on bakeries Delta, Penam and Odkolek over a cartel on prices from 2003 to 52.8 million CZK from 66 million CZK.

Mr. Pecina stated in his decision that the Office had assessed the seriousness of the offence correctly at first, but it had made a wrong decision concerning the duration of the offence.

Penam is a unit of Czech Agrofert Holding. The foreign owners of Delta and Odkolek, United Bakeries Luxembourg and Bakeries International Luxembourg, merged this year.

The Office suspected that the largest players on the market for baker's products had agreed on a leap growth in prices by some 20 percent after prices had been stagnant for seven years.

At first, the bakeries were ordered to pay fines amounting in total to 120 million CZK. But all three companies filed an appeal, saying they had reacted to a sharp growth in wheat prices, and the Office then cut the fine to 66 million CZK.

Press and personnel department