The automotive sector remains under close scrutiny of the European Commission. The recent press release of the European Commission on the opening of a formal investigation into German car manufacturers constitutes a new chapter in a line of cartel investigations into the automotive sector that has been going on for several years now. This new investigation may very well not be the last.
In an earlier press release dated 23 October 2017, the European Commission confirmed that its officials carried out inspections at the premises of several car manufacturers in Germany. These inspections were related to concerns that the German car manufacturers may have colluded with the aim of coordinating and slowing down technical development of passenger cars. Agreements to limit or control technical development are prohibited under the EU cartel prohibition and are punishable by substantial fines of up 10 percent of annual group turnover.
On the basis of information found during the aforementioned inspections, the Commission has now opened a formal investigation in order to assess whether the so-called ‘circle of five’, consisting of BMW, Daimler and the German brands of the Volkswagen group (Volkswagen, Audi and Porsche), colluded in order to limit the development and roll-out of certain emission control systems. These systems reduce harmful emissions from passenger cars powered by diesel or petrol engines. Through its investigation, the Commission aims to establish whether the German car manufacturers violated the EU cartel prohibition through their alleged conduct.
In a previous AutomotiveBit, we described the string of earlier EU cartel cases in the automotive sector (not only manufacturers, but also their suppliers). This new investigation shows that the European Commission’s attention for the automotive has all but diminished. Given this pattern, the automotive sector may be expected to remain at the center of the European Commission and the national competition authorities’ attention in the years to come. Compliance must therefore remain a key priority for all companies that operate in the automotive sector.