Cyprus Mail

Cattlers’ association fined for price fixing (updated)

By Angelos Anastasiou

THE COMPETITION watchdog (EPA) has slapped the cattlers’ association (POA) with fines totalling €2.1 million for price-fixing and other irregularities.

The fines have to be paid within six months.

According to EPA’s statement, after reviewing and evaluating all available evidence, the competition protection body unanimously found the association in breach of three articles of competition law.

In a statement issued later on Friday, POA said it will appeal the decision. The organisation said it had countered all the arguments presented by the watchdog, which nevertheless proceeded to impose a fine.

The probe focused on the nature and terms of POA’s cooperation with its members, and the association’s actions and practices in selling milk from January 1, 2009 to May 28, 2012.

In its decision, EPA noted that the fresh cows’ milk market is restricted by quotas, meaning that market entry is incumbent on being allocated a production quota by the government authorities.

As such, the market is inherently restricted, and any actions or practices contrary to the principles of free competition can be particularly harmful to competition and the subsequent stages in the chain of production using cows’ milk as a raw material.

“The Commission calls on POA to pay the sum of €2,100,000 within six months of the date of issuance of this decision,” the ruling read.

Addressing POA’s claim that paying the fine would jeopardise the viability of cattle-farmers – citing the haircut on bank deposits imposed in March 2013 – and cause a chain reaction across all markets using cow milk as a raw material, thus impacting consumers adversely, the commission ruled that such an argument could not be substantiated.

“On the issue of the ‘haircut,’ the Commission noted that in the POA’s annual financial statements for 2012, which were prepared in January 2014, the ‘haircut’ was not recorded as a significant event in 2013 (under the headline “Events After the Reporting Period”),” the report said. “These financial statements were voted at the POA’s general assembly on January 10, 2014.”

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