The European Union (EU) has imposed a €15.9 million ($17.1 million) fine on US giant International Flavors & Fragrances (IFF) for hindering a significant cartel investigation. The penalty arises from an incident where an IFF employee deleted WhatsApp messages after being informed of an impending inspection by EU antitrust regulators.
Last year, Brussels antitrust regulators conducted raids at various companies across Europe, including IFF, due to suspicions of price collusion within the fragrance industry. During these inspections, the European Commission, the EU’s antitrust regulator, sought access to the phones of certain IFF employees. It was discovered that a senior employee had deleted WhatsApp messages containing business-related information exchanged with a competitor after being notified about the inspection.
Although IFF subsequently assisted the commission in recovering the deleted data, the EU initiated a parallel case against the company for obstructing the investigation. In such cases, the commission has the authority to impose fines of up to one percent of a company’s total turnover. However, considering IFF’s “proactive cooperation during and after the inspection,” the commission opted for a fine of only 0.15 percent.
The suspicion of cartel activity extends beyond the European Union. European and US antitrust authorities, including Swiss officials, initiated investigations last year into the largest companies in the sector, including IFF, Swiss firms Firmenich International and Givaudan, and Germany’s Symrise, on suspicions of a price cartel. Fragrances and flavors are vital ingredients in a wide range of products, from fine perfumery and cosmetics to shampoos, detergents, and food items, making it a multi-billion dollar market.
