On 11 July 2019, the Spanish Competition Authority, the ‘Comisión Nacional de Mercados y Competencia’ (‘CNMC’) fined ten large dairy companies operating in Spain €80 million for breaches of competition law between the years 2000 and 2013 (Expte. S/0425/12 INDUSTRIAS LÁCTEAS 2).
CDC is currently preparing the bundled enforcement of damage claims to which the dairy farmers harmed by the milk cartel are entitled (more on this below).
Background – The Spanish Milk Cartel
According to the CNMC’s findings, the main purchasers of raw cow’s milk exchanged information on purchase prices, purchase quantities and milk surpluses since 2000. This enabled them to coordinate trading strategies, restrict competition in the market for the supply of unprocessed cow’s milk and prevent farmers from obtaining competitive market prices for their raw milk. As a result, they prevented dairy farmers from negotiating prices and gave them the choice of either selling their milk at lower prices or not being able to sell some of it at all. According to the CNMC, this way the cartel members managed to force prices below competitive levels.
The companies involved in the milk cartel are Calidad Pascual, S.A. (formerly Grupo Leche Pascual, S.A.), Central Lechera de Galicia (CELEGA, S.L.), Corporación Alimentaria Peñasanta, S.A. , Danone, S.A. , Grupo Lactalis Iberia, S.A. , Nestlé España, S.A. , Industrias Lácteas de Granada, S.L.U. (formerly PULEVA FOOD, S.L.), Schreiber Food España, S.L. (formerly SENOBLE IBERICA, S.L.), Association of Galician Dairy Companies, Guild of the Catalan Dairy Industry, Industrias Lácteas Asturianas, S.A. , Grupo Leche Río, S.A. , Feiraco Lácteos, S.L. , Leche Celta, S.L. , Forlactaria Operadores Lecheros, S.A. and Central Lechera Asturiana, S.A.T.
Compensation for dairy farmers
Dairy farmers affected by the cartel are entitled under Spanish and EU-law to claim full compensation from the cartel members for the damage caused by the anti-competitive practices established by the CNMC. Any claim for damages would also include accrued interest from the time the damage occurred. In its decision, the CNMC estimates that the anti-competitive practices of the dairy companies resulted in an artificial price decrease of more than 10%. According to this, each dairy farmer could claim at least 10% of his turnover during the cartel period plus accrued interest. However, how much damage was suffered in each individual case can only be quantified after a comprehensive economic damage analysis has been carried out.
Bundled claim enforcement through CDC
Together with its cooperation partners, CDC is currently preparing to enforce the claims for damages of a large number of dairy farmers. The dairy farmers are not only benefiting from CDC’s almost 20 years of experience and expertise in the field of Europe-wide enforcement of antitrust claims for damages, but also from CDC’s full assumption of all costs and risks. The advantages of comprehensive data collection associated with the “bundling model” developed by CDC also enables the preparation of a robust damage analysis as well as the best possible presentation of evidence in the event of court proceedings. The synergy effects and stronger negotiating power vis-à-vis the cartel members achieved through the bundling of claims round off the complete alignment of interests between the harmed dairy farmers on the one hand and CDC on the other.
Can I still join CDC’s bundling approach?
Yes! CDC is in principle open to including the claims of additional dairy farmers in its bundled claims enforcement. If you are interested in more detailed information on this, simply contact us. We will be happy to personally explain our approach and all the associated benefits to you (we also speak Spanish).Contact CDC without delay