Chiquita Cartel Case Paves Way for European Evidence Swaps

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By Eleanor Tyler

The European Commission can use evidence from Italy’s tax authorities in building a case against a cartel that fixed prices for bananas in Greece, Italy and Portugal, Europe’s Court of Justice affirmed in an April 27 judgment ( FSL Holdings NV v. Commission , E.C.J., Case No. C‑469/15 P, 4/27/17 ).

The court’s judgment “will pave the way for future cooperation between authorities at EU and national levels, both antitrust authorities and administrative bodies active in other areas,” the Advocate General said in its opinion on the case.

The decision means that the defendant fruit companies will have to pay the fines imposed on them in 2011 for their cartel as well as the court costs for the lengthy appeals.

FSL Holdings, Firma Léon Van Parys and Pacific Fruit Company Italy appealed their 8,919,000 euro (about $9.7 million) fine for participating with Chiquita Brands International Inc. in a price fixing cartel in 2004 and 2005 in southern Europe. Chiquita had already confessed to a Europe-wide cartel to EU authorities and won immunity from punishment through the EU’s leniency program.

In the general court, Pacific Fruit managed to reduce the fine to 6,689,000 euros ($7.3 million) by showing that the cartel broke down for several months. But the general court otherwise rejected the banana companies’ grounds for appeal, including their insistence that the commission wasn’t entitled to use documents from an unrelated national enforcement agency in building its case.

As part of its investigation, the European Competition Commission got copies of documents that the Italian financial police recovered from a Pacific Fruit Company employee during a national tax investigation. The companies argued that rules governing sharing of information between national competition authorities and the EU forbade the European Commission from using information from investigations that had nothing to do with competition, such as the Italian tax case.

The Court of Justice rejected that argument, holding that the rules for competition information exchanges don’t bar the European Commission from getting evidence solely from other competition agencies.

Because the EU got the documents legally from Italy’s tax authorities, and their credibility was unquestioned, they were admissible in the competition case, the court said.

The companies’ other arguments against the fine, including a contention that Chiquita shouldn’t have gotten away without a fine, were unsuccessful.

To contact the reporter on this story: Eleanor Tyler in Washington at etyler@bna.com

To contact the editor responsible for this story: Fawn Johnson at fjohnson@bna.com

For More Information

The court's judgment is at http://src.bna.com/oie.

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