The EU on Thursday imposed a 337.5 million euro ($366 million) fine on Mondelez, the US confectioner known for brands like Toblerone and Oreo, for limiting the sale of products within the 27-country bloc. Mondelez, previously called Kraft, is a major producer of chocolate, biscuits, and coffee, with $36 billion in revenue last year.
The EU fined Mondelez “because they have been restricting the cross-border trade of chocolate, biscuits, and coffee products within the European Union,” said Margrethe Vestager, the EU’s competition commissioner.
“This harmed consumers, who ended up paying more for chocolate, biscuits, and coffee,” she stated to reporters in Brussels.
“This case concerns the price of groceries, a key issue for European citizens, especially in times of high inflation and cost-of-living crises,” she added.
The free movement of goods is a fundamental principle of the EU’s single market. Mondelez’s portfolio includes Philadelphia cream cheese, Ritz crackers, and Tuc salty biscuits, alongside chocolate brands Cadbury, Cote d’Or, and Milka.
EU commission accuses Mondelez of abusing its dominant position in violation of regulations
The commission, the EU’s main antitrust authority, accused Mondelez of “abusing its dominant position” in violation of EU regulations. It claimed the confectioner engaged in “anticompetitive agreements or concerted practices” from 2012 to 2019, such as restricting wholesale customers’ ability to resell products and requiring them to set higher export prices compared to domestic sales.
The EU’s investigation began in January 2021, but suspicions led to raids on Mondelez offices across Europe in November 2019. The commission said that between 2015 and 2019, Mondelez refused to supply a trader in Germany to prevent the resale of chocolate in Austria, Belgium, Bulgaria, and Romania, “where prices were higher.”
It also halted the supply of certain chocolate products in The Netherlands “to prevent them from being imported into Belgium, where Mondelez sold these products at higher prices.”
Mondelez maintained that the fine was related to “historical, isolated incidents, most of which ceased or were remedied well in advance of the commission’s investigation.”
“Many of these incidents were related to dealings with brokers, often involving sporadic, one-off sales, and a few small-scale distributors developing new business in EU markets where Mondelez does not have a presence or does not market the respective product,” the company added in a statement.
The company had reserved 300 million euros for the fine last year. “No further measures to finance the fine will be necessary,” it said.