Início Tech EC Fines IFF 15.9 Million Euros for Antitrust Inspection Obstruction

EC Fines IFF 15.9 Million Euros for Antitrust Inspection Obstruction

PARIS – The European Commission has fined International Flavors and Fragrances Inc. and International Flavors and Fragrances SAS 15.9 million euros for obstructing an antitrust inspection in 2023.

“The commission found that during the inspection, a senior employee of IFF intentionally deleted WhatsApp messages exchanged with a competitor,” the European Commission said in a statement released Monday.

As previously reported, in early March 2023, the commission carried out unannounced inspections on the world’s four largest fragrance and flavors suppliers – Firmenich, Givaudan, Symrise and IFF – as part of an investigation in numerous member states into possible collusion.

“IFF has agreed to pay the European Commission a 15.9 million euro fine to settle a charge relating to the destruction of evidence during the commission’s industry investigation of suspected anti-competitive conduct in the supply of fragrance and fragrance ingredients,” IFF said in a separate statement Monday.

“During its inspection, the commission asked to review the mobile telephones of some of IFF’s employees,” the commission said. “While reviewing, the commission detected that a senior employee had deleted WhatsApp messages exchanged with a competitor containing business-related information. The deletion took place after the employee had been informed about the commission’s inspection.”

This was a former employee of IFF’s scent division, according to IFF, which said the person’s action was contrary to the explicit instructions of the company’s legal department and the commission.

“IFF quickly helped the commission recover the deleted messages,” IFF said. “This former employee’s actions – which violated IFF policy and legal guidance – are not tolerated. We stand firm in our commitment to ethical conduct and adherence to the law.”

The commission concurred IFF immediately acknowledged the facts and proactively cooperated during and after the inspection.

In March, the commission opened proceedings against IFF for investigation obstruction. 

“IFF engaged in a cooperation procedure by acknowledging its liability and accepting the maximum amount of the fine,” continued the commission.

The commission is legally allowed to impose fines of up to 1 percent of a company’s total sales if an antitrust investigation is obstructed, and takes into consideration the gravity and duration of the infringement. 

“The commission considers that the infringement committed by IFF is of a very serious nature, particularly given that the senior employee intentionally deleted the WhatsApp messages after having been informed about the commission’s inspection,” the commission said. “In addition, the commission was not informed of the data deletion. Instead, commission inspectors had to detect the deletion themselves after the mobile phone was submitted for review.”

The commission opted for a fine equal to 0.3 percent of IFF’s total sales, but rewarded IFF for its proactive cooperation during and after the inspection. So it halved the fine that now represents 0.15 percent of the company’s total sales.

This instance marks the commission’s first fine for messages being deleted via social media applications on a mobile phone.

The commission said its investigation into the fragrance industry remains ongoing and is not related to its decision regarding the IFF fine.

“We are working closely with relevant authorities and cooperating with their industry investigation,” IFF said.

In March, the commission explained in a statement: “The inspection and requests for information concern possible collusion in relation to supply of fragrances and fragrance ingredients.”

The commission underlined that announced inspections are the first step into investigating anticompetitive practices. It said such inspections being carried out doesn’t mean companies are guilty ant that they do not prejudge the investigation’s outcome.

In July 2023, Symrise appealed the commission’s search.

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