Brussels, 20/06/2001 (Agence Europe) - The European Commission decided to impose a fine of EUR 19.7 million on the French tyre manufacturer Michelin for abuse of dominant position on the French market for heavy good vehicles replacement tyres. The infringement is all the more serious as the Commission had already imposed a punishment, in 1981, for similar behaviour in the Netherlands and imposed a fine of 680,000 Ecus, substantial amount at the time.
The Commission had opened an in-depth investigation in May 1996 over certain actions by Michelin and was able to gather in June 1997, following several inspections in the French offices of the tyre manufacturer, proof that this company abused its dominant position in the specific market for retread tyres (that is to say new tread if the casing is in sound condition) and new replacement tyres for heavy good vehicles in France via complex practices of quantitative rebates, bonuses and other commercial practices. The Commission reached the conclusion according to which these practices constituted an abusive loyalty system towards distributors and had artificially closed the French market to other tyre manufacturers between 1990 and 1998. Michelin had finally abandoned this policy in January 1999.
Commenting on the case, Commissioner Monti severely condemned the dominant companies that carry out practices excluding other market actors, adding that if the discounts constitute normal trade practices they are nevertheless illegal when they are granted by a company in a dominant position and which have an excluding effect, as in this case. In fact, Michelin holds, according to the Commission, more than 50% of the new replacement tyre market for heavy good vehicles in France and its share is even greater in the French market for retreads. No other competitor is of a comparable size. By setting the size of the fine, the Commission feels that the infringement was serious, that it had lasted for many years and that it had a noticeable effect on the European market. Furthermore, the fact the Michelin has already been condemned for a similar behaviour constituted an aggravating circumstance. The size of the fine was nevertheless revised given the cooperative behaviour of Michelin and the fact that the group had put an end to its actions, before receiving the statement of objections.