Mondelez Fined by EU for Antitrust Violation
Mondelez, the renowned maker of Oreo, Cadbury Dairy Milk chocolate, Toblerone, has been fined €337.5 million by the European Union for breaching antitrust rules. This penalty marks the EU’s ninth-largest antitrust fine and comes amidst concerns over rising food costs in Europe.
Background of Mondelez
- Formerly known as Kraft, Mondelez is a global giant in the production of chocolate, biscuits, and coffee, boasting a revenue of $36 billion last year.
- Mondelez’s portfolio includes popular brands like Philadelphia cream cheese, Ritz crackers, Tuc salty biscuits, Cote d’Or, and Milka.
EU’s Allegations and Response
The EU’s competition commissioner, Margrethe Vestager, accused Mondelez of unlawfully restricting cross-border sales within the EU to artificially inflate prices of its products, thereby harming consumers.
Mondelez, in response, stated that the fine was linked to past incidents that had been addressed prior to the EU’s investigation. The company emphasized that these incidents were largely related to business dealings with brokers and limited-scale distributors in markets where Mondelez was not actively present.
Impact on Consumers
Vestager highlighted that the antitrust violation by Mondelez had a direct impact on consumers, leading to higher prices for everyday items like chocolate, biscuits, and coffee. This issue is particularly significant amid a period of high inflation and cost-of-living concerns across Europe.
Investigation and Conclusion
The EU’s investigation into Mondelez dates back to January 2021, culminating in the imposition of the hefty fine in May 2023. The Commission found that Mondelez had abused its dominant market position by limiting sales to countries with lower prices, contravening EU competition regulations.
With the fine now imposed, Mondelez faces the repercussions of its antitrust practices and the need to comply with fair competition standards within the European market.
