MICHELIN is challenging the legality of European Union antitrust raids on its facilities as regulators swept across the tyre industry for evidence of a suspected price-fixing cartel.
The French firm was targeted by so-called surprise inspections in January – alongside rivals including Bridgestone, Continental, and Goodyear Tyre & Rubber as part of one of the biggest EU probes in years.
Michelin said on Wednesday (Apr 17) it filed an appeal to the EU’s General Court in Luxembourg over the European Commission’s move, claiming the decision to launch the raids was based “on vague and insufficient elements.”
While the commission “is fully entitled to launch any preliminary investigation, it must do so based on sufficiently substantiated theory of harm and in a proportionate manner, respectful of companies’ rights,” the Clermont Ferrand, France-based firm said.
If it eventually wins its challenge, judges could void potential evidence gleaned during the inspections – frustrating efforts by regulators to build their case. A probe into alleged collusion by French supermarket chains Casino Guichard Perrachon and Intermarche was abandoned last year, weeks after judges faulted the conduct of raids.
A commission spokesperson declined to comment.
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EU regulators said in January they were concerned “that price coordination took place among the inspected companies, including via public communications.” Michelin responded to the move by saying that it “scrupulously” follows EU competition rules.
Antitrust watchdogs are ramping up their dawn raids after the Covid crisis brought them to a standstill. The EU’s investigation into the tyre industry came after similar evidence-gathering at premises of construction chemicals firms and food delivery services.
Such inspections are a preliminary step. The EU may start formal proceedings if evidence shows the companies broke the bloc’s antitrust rules, which could eventually lead to fines of as much as 10 per cent of global revenue. BLOOMBERG