Four of the biggest names in the world’s fragrances and flavors sector are under investigation by competition police in Europe and the United States who suspect illegal price fixing and stifling competition.
The Swiss Competition Commission (COMCO) unveiled the first, on Wednesday morning, the names of the companies targeted by this international investigation and it is the Gotha of a sector worth billions: Firmenich International SA (Geneva), Givaudan SA (Geneva), International Flavors & Fragrances Inc. (USA) and Symrise AG (Germany).
The Swiss competition policeman “has indications that several companies active in the production of perfumes (“fragrances”) have violated cartel law”, writes COMCO, which is associated with the European Commission, but also with the police. British and American competition.
Firmenich, the world’s largest privately held fragrance and flavor company headquartered outside of Geneva, Switzerland, confirmed raids on its offices in France, Switzerland and the UK on Wednesday, ” as part of an industry-wide investigation,” a company spokesperson told AFP.
“Firmenich is closely monitoring the situation and is cooperating fully with investigators. We are unable to comment further at this stage,” he continued.
“As a corporate citizen, Givaudan is cooperating fully with the authorities,” said a spokesperson for the group.
“Givaudan is committed to and adheres to the highest ethical standards of business conduct, as set out in our Principles of Business Conduct,” she added.
Coordinated prices
“There are suspicions that these companies would have coordinated their pricing policy, prevented their competitors from supplying specific customers and restricted the production of certain perfumes”, further explains the COMCO.
Perfumes and flavorings are used in the manufacture of many products, including but not limited to cosmetics, personal care products, detergents and cleaning products.
“As part of the investigation, it will be examined whether there are indeed restrictions of competition prohibited by cartel law”, underlines the competition authority, adding that the presumption of innocence applies. to businesses.
The European Commission had reported on Tuesday evening of this ongoing investigation without naming names.
She says she fears that “fragrance companies and an association around the world may have breached EU cartel rules.”
And above all, it calls on those who have participated in an agreement to collaborate in order to possibly benefit from immunity or a significant reduction in the fine incurred.
The giants of perfume and aroma
Founded in 1895, Firmenich is known for its noses. Its master perfumers are at the origin of successful perfumes such as Angel (Thierry Mugler), Acqua di Gio (Armani) or Flower (Kenzo).
This family business is to merge with the Dutch DSM.
Firmenich posted an increase in its half-yearly turnover of 10.5% over the first six months of its staggered 2022/2023 financial year to 2.4 billion Swiss francs (2.4 billion euros).
Givaudan for its part recorded a net profit for 2022 that exceeded expectations, up 4.2% year-on-year to 856 million francs, and sales up 6.5% to 7.1 billion. francs.
The Givaudan share dropped 3.2% on Wednesday morning on the Swiss market at 2712 CHF around 10:15 GMT.
The American International Flavors and Fragrances, for its part, has a turnover of 12.44 billion dollars (11.80 billion euros) for 2022 and a pre-tax loss of 1.63 billion dollars.
As for the German Symrise – which has more than 12,000 employees in 40 countries, it announced on Wednesday for 2022 a turnover of 4.6 billion euros for a net profit of 280 million dollars (265.55 million euros).