Johnson Controls is set to escape forthcoming European Union antitrust fines after owning up to price rigging with smaller rivals on the price of lead purchased from scrap dealers, according to Bloomberg newswire.
Eco-Bat Technologies Ltd, Recylex SA, and Campine SA still expect to be fined in the coming weeks for their role in a cartel among companies buying lead recycled from car batteries.
The fines will come just months after the EU fined truckmakers nearly €3billion ($3.3 billion) for setting prices for more than a decade.
The car industry has been a focus for regulators who are probing how auto suppliers coordinate to shore up their own profits.
Johnson Controls won’t be fined because it was the first company to blow the whistle on the other companies’ actions, Johnson Controls is fully cooperating with the EU’s ongoing probe into procurement practices, said Christian Riedel, a spokesman for the company in Hanover, Germany.
The European Commission last year sent formal complaints to five lead recycling companies, alleging they illegally agreed to reduce the purchase price for scrap lead-acid batteries.
The lower prices paid to scrap dealers helped the cartel to make higher profit margins from 2009 to 2012 in Belgium, France, Germany and the Netherlands, the EU said.
Eco-Bat set aside £21 million pounds ($26 million) to cover a fine targeting it and two units, Berzelius Metall GmbH and Societe de Traitement Chimiques des Metaux, it said in its report for the first quarter of 2016. “A number of uncertainties” over the potential fine and related costs may mean that the financial consequences “may be materially in excess of the provision” and add another £10 million ($12 million) to liabilities, it said.
Recylex said it was cooperating with the commission and declined to comment on any forthcoming fines. In its 2015 annual report, it said it didn’t make any provisions for a fine by the end of 2015 “given the tremendous uncertainty concerning the size of any fine,” which cannot exceed a cap of 10% of the company’s yearly revenue of €38.5 million ($42 million).
Johnson Controls became an Irish company after merging with Tyco International Plc in a so-called inversion deal announced in January and completed last month. Johnson Controls’ automotive business is scheduled to spin off into an independent company, known as Adient, on Oct. 31. Once separated, the companies will be known as Adient Plc and Johnson Controls International Plc.
The recycling business will form part of Johnson Controls Power Solutions and remain with Johnson Controls International.