EU's Vestager warns of more anti-cartel raids, criticises 'no-poach' deals

·2 min read
FILE PHOTO: European Commission's executive Vice President Margrethe Vestager delivers a speech during a debate on EU-Taiwan political relations and cooperation at the European Parliament in Strasbourg

By Foo Yun Chee

BRUSSELS (Reuters) - EU enforcers are planning a series of raids against companies suspected of illegal price-fixing, Europe's anti-trust chief warned on Friday, as she also sounded the alarm about competition in labour markets due to "no-poach" deals.

The European Commission last week raided Europe's largest pulp producers Stora Enso and UPM, and Metsa Board unit Metsa Fibre, the first in two years as the COVID-19 pandemic halted such actions.

Companies suspected of taking part in other cartels should soon see officials knocking on their doors, EU Competition Commissioner Margrethe Vestager said.

"And that's just the start of a series of raids that we're planning for the months to come – you'll understand if I don't say exactly when or where they're going to happen," she told a conference organised by the Italian anti-trust authority in Rome.

Companies found guilty of taking part in cartels face fines as much as 10% of their global turnover. Whistleblowers are rewarded with immunity from sanctions while those who provide crucial information can get hefty reductions in their penalties.

She said regulators may sweeten such so-called leniency deals with companies as the growth in private damages claims from customers deter many from sharing key data with enforcers.

Vestager also criticised "no-poach" agreements between companies, saying that this could create a cartel, a sign that she may be mulling action.

Individuals are directly effected "when companies collude to fix the wages they pay or when they use so-called 'no-poach' agreements as an indirect way to keep wages down, restricting talent from moving where it serves the economy best", she said.

No-poach agreements, in which companies agree not to hire each others' workers, and non-compete agreements, in which workers sign contracts pledging not to leave to work for a rival, have in recent years drawn criticism.

(Reporting by Foo Yun Chee; Editing by Alex Richardson)

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