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US confectionery giant Mondelez will be fined millions of euros as early as next month for restricting sales of its products between EU member states, according to three people with direct knowledge of the decision.
Regulators in Brussels will order the US-based group, which owns brands including Oreo, Cadbury and Toblerone, to stop blocking cross-border trading because of the potential harm to consumers at a time of high inflation, the people said. The timing of the announcement and the amount of the fine could change, they added.
The EU originally raised concerns about cross-border trade in Modelez products in 2021 and opened an antitrust investigation.
This looked at whether the company was trying to restrict “parallel” trade, where products can be sold for lower prices because they have been brought in from a country where they cost less.
The EU had now found against Modelez and would issue a fine and an order for the company to end any anti-competitive practices, the people said.
The investigation by the European Commission, the EU’s executive body, examined, in particular, restrictions on languages used on packaging, which would potentially undermine the choice of countries a trader can sell in, and whether curbs on parallel trading had pushed up prices or limited choice for customers across the continent.
When the probe was opened, the EU’s top competition enforcer Margrethe Vestager said: “Chocolates, biscuits and coffee are products consumed by European citizens daily,” and that it would look at “whether Mondelez, a key producer of these products, might have restricted free competition in the markets . . . leading to higher prices for consumers”.
The decision comes as European consumers have been grappling with several years of high inflation, which has particularly affected food prices.
This year, Mondelez set aside €340mn against a potential EU fine that it said could be materially higher. Regulators can impose fines of up to 10 per cent of a company’s global turnover if they are found to have broken EU competition law.
The European Commission declined to comment.
Mondelez said: “We are co-operating with the investigation and engaging with the European Commission in an effort to reach a proportionate resolution to this matter. We cannot comment further on an ongoing legal proceeding.”
Additional reporting by Madeleine Speed in London
