What is a cartel?

It is an arrangement between several competing companies to fix the prices of their products, allocate customers or public contracts, etc. This hurts both consumers and the market.

A cartel can be formed through various means, including: 

• price fixing;
• production restrictions;
• market sharing, including bid rigging;
• exchanging strategic information to reduce the uncertainty inherent in free competition.

So companies can't make agreements with each other?

Yes, they can. There are some agreements between companies that can have favourable effects for consumers because they lead to improvements in production, distribution or marketing, or promote technical progress.

All these positive effects would counterbalance the detrimental effects from a competition point of view. Agreements to research and develop new technologies are a good example of this.

Companies have to assess themselves, in order to determine whether a given agreement may constitute a cartel or not.

What are the consequences of belonging to a cartel?

For the company

Fines may be up to 10% of the total turnover of the offending company in the financial year immediately preceding the imposition of the fine. In addition, a prohibition on contracting with the public administration may be imposed.

For legal representatives or managers

Legal representatives or managers can also be sanctioned with fines of up to €60,000.