Victory for Finnish paper manufacturers in cartel dispute

European Commission halts investigation of alleged fine paper cartel

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Competition authorities of the European Union have ended their investigation into a suspected cartel by European manufacturers of fine grades of paper.
      The move indicates that the European Commission has not found evidence of illegal cooperation among competitors in the field. The EU investigation into manufacturers of newsprint and magazine paper is continuing. Authorities in the United States are also looking into the possibility of a paper cartel.
      Fine grades of paper, including photocopy paper, are made out of bleached pulp.
      The decision is seen as a victory for the Finland’s manufacturers of fine paper - Stora Enso and the Metsäliitto subsidiary M-real. The decision does not affect UPM, which has already been given immunity in the matter.
     
The cartel affair began just over two years ago when UPM came forward and admitted that it had taken part in an illegal fine paper cartel with its competitors. In return UPM was released from possible legal consequences.
      Both Stora Enso and M-real praised EU officials for their relatively quick action on the matter, as two years is a fairly short time for a cartel investigation. A previous investigation into a suspected newsprint cartel took seven years.
     
Stora Enso legal affairs manager Jyrki Kurkinen said that the company had always expected to be cleared of the accusations. He adds that the process has cost Stora Enso about a million euros in legal expenses.
      Kurkinen nevertheless does not expect that his company will seek damages from UPM for making what he says were false accusations. "But we can be sulky in that direction."
      M-real’s head of legal affairs, Nina Kuulusa takes comfort in the fact that the Commission came to a decision as quickly as it did. "In magazine paper, everything remains open, so we’re not opening any champagne bottles yet."
      UPM’s head of legal affairs, Juha Mäkelä, confirms that the company has received a letter from the Commission, but he would not comment on its content. His silence stems from the fact that UPM has agreed to cooperate with the Commission’s competition authorities, and he does not want to violate the possible conditions of the immunity agreement.
     
In addition to newsprint and magazine paper, the Commission is still investigating alleged irregularities in the trade in adhesive paper and waste paper.
      Finnish competition authorities say that UPM, Stora Enso, and Metsäliitto have sought to limit competition in the acquisition of wood.
      The authorities are currently examining responses submitted by the companies, and are to decide after the summer, if the matter is worth taking to the Finnish Market Court.


Previously in HS International Edition:
  Paper maker UPM gets massive fine for leading role in industrial bag cartel (1.12.2005)
  Document reveals strict conditions for severance package for ex-UPM CEO Juha Niemelä (31.5.2005)
  Competition Authority refuses to hand over documents in forest industry cartel case (7.6.2005)
  Police raid offices of numerous forest companies over cartel suspicions (26.5.2004)
  Juha Niemelä unexpectedly resigns as CEO of UPM-Kymmene (30.1.2004)

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