The European Commission and the Swiss WEKO ( are currently investigating several major players in the fragrances and flavours segment for suspected price fixing..
The fragrances and flavours industry is a highly competitive one, with many companies vying for market share. However, the industry is also heavily regulated, with strict rules governing the composition and labelling of fragrances and flavours. Fragrances are used in the manufacture of numerous products, including cosmetics and personal care products as well as detergents and cleaning agents. At the beginning of the month (07.03.2023), the EU Commission announced that competition proceedings had been initiated. The Swiss Competition Commission WEKO confirmed its antitrust investigation against several manufacturers a day later.
The investigations by the European Commission and the Swiss WEKO are focused on allegations that mentioned companies have engaged in price fixing, which is illegal under the EU (under Article 101 of the Treaty on the Functioning of the European Union (TFEU)) and Swiss competition law. Price fixing occurs when companies agree to set prices at a certain level, thereby eliminating competition and artificially inflating prices for consumers.
According to the WEKO house searches were carried out at various sites. These were carried out in coordination with other competition authorities, namely the EU Commission, the US Department of Justice Antitrust Division, and the UK Competition and Markets Authority. As part of the investigation, it is to be examined whether any restrictions on competition are illegal under antitrust law. The presumption of innocence applies to companies.
If the allegations of price fixing are proven to be true, the companies involved could face fines and other penalties. The fines would not have to be as high. The EU Commission states that fines in antitrust cases usually amount to 15 to 20 percent of the affected sales, with a cap of 10 percent of the annual sales of the companies involved. In addition, the reputation of the fragrances and flavours industry could be damaged, as consumers may lose confidence in the industry's commitment to fair competition.
To avoid the risk of price fixing, your company should establish and maintain a compliance program that includes training employees on the competition rules, implementing internal controls to detect and prevent anti-competitive behaviour, and regularly reviewing and updating their pricing practices.
You should also be aware that your company can be held liable for any anti-competitive behaviour of its suppliers, distributors, or other business partners, so it is important to conduct due diligence and carefully select your partners.