Following an application for leniency by Exide Technologies GmbH, the German Federal Cartel Office (FCO) conducted an industry-wide raid in April 2014. While Exide Technologies will not face any conse-quences, the FCO imposed fines on the other companies involved (Hawker GmbH and Hoppecke Batterien GmbH & Co. KG) of approximately 28 million euros. Both manufacturers of industrial batteries and their representatives agreed on a so called 'lead surcharge' as a key component of their pricing structure.
The 'lead surcharge' is a pricing instrument that allows changes in raw material prices to be automatically included in the final sale price. This allows the adjustment of sale prices without any contractual alterations, causing the price risk of raw materials to shift to the customer. The lead price quotation of the London Metal Exchange is used as a reference for the level of the surcharge. Such a surcharge is in itself permitted and can be contractually agreed upon.
However, the FCO considers it to be unjustifiable for suppliers to harmonize their usage of this instrument amongst each other, especially to introduce or maintain such a surcharge across the industry as a standard. The companies involved decided on introducing the lead surcharge in early 2004 and regularly confirmed this agreement in association meetings. They did, however, not agree on the detailed method of calculation or the exact level of the surcharge.
In addition, during the period from 11 September 2012 to 18 March 2014, the aforementioned companies agreed to shift the increased costs of lead and lead alloy regarding the distribution of motive power batteries to the customers. This arrangement was confirmed and renewed during both confidential discussions and association meetings.
The proceedings regarding Hoppecke and Hawker were concluded by means of settlement. The imposition of fines took account of the fact that the company Hoppecke had comprehensively cooperated in the clarification of the agreements with the FCO. The proceedings against three other involved companies were not continued, as both their contribution to the infringement as well as their market power was considered to be significantly low in comparison to the sanctioned companies. While the fines imposed on Hoppecke are final, Hawker can still appeal to the Higher Regional Court.
