EC investigates alleged polychloroprene cartel

Brussels - The European Commission has recently sent a Statement of Objections to, "a number of companies" regarding their alleged role in a cartel for chloroprene rubber (CR). The EU did not add any further details and did not name any of the companies involved.

Statements of Objections are a formal step in European antitrust investigations. After receiving such statements, companies have around two months to defend themselves in writing. They can also ask the Commission to hear their case at an oral hearing which usually takes place about one month after the written reply has been received. Only after having heard the company's defence can the Commission take a final decision, which may be accompanied by fines of up to ten per cent of a company's worldwide annual turnover.

Two years ago the US Dept of Justice fined Dow Chemical, DuPont Dow and Syndial (Enichem) a total of almost $100 million for participating in an "international conspiracy" to fix prices from Sept. 1999 to April 2002.

In an agreement folowing that judgement, Dow Chemical transferred all liability for similar action onto its former partner, Du Pont.

In a prepared statement, DuPont Performance Elastomers said, "An investigation by the European Commission into alleged violations of EU competition law in the polychloroprene industry (PCP) has been underway for several years involving DuPont Performance Elastomers (DPE) and other PCP producers. DPE continues to cooperate with the Commission in this investigation. While the investigation continues, we are not at liberty to comment any further. We remain committed to serving customers and meeting the highest standards of ethical and legal compliance."

Currently the only CR factory in the European Union is in Dormagen, Germany and operated by Lanxess AG, however, Günther Weymans, senior vice president of Lanxess AG responsible for technical rubber products said the company has not received a letter from the EC and is not in involved in the investigation in any way. None of the other manufacturers of CR was ready to make a statement immediately.

Until 2005, Enichem operated a CR unit in Champagnier in southern France, but closed it after difficulties with raw materials supply.

Du Pont Performance Elastomers supplies CR from a factory in the US. It is in the process of opening a new factory and closing an older one there.

Showa Denko operates a plant in Japan, and currently imports CR from there. The CR market is undergoing extremely tight supply following the closure of the Champagnier plant in 2005.

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Press statement from the EU