GRANA PADANO CONSORTIUM
PRESS RELEASE
PRESS RELEASE
The Authority has authorised a derogation for the Grana Padano cheese repositioning agreement,
and imposed fines for the 2001 resolutions
At its meeting on 24 June 2004, the Competition Authority resolved to complete the investigation begun on 31 July 2003 into the Consorzio a Tutela del Grana Padano following the notice submitted by the Consortium notifying an agreement regarding the "repositioning" of the product. The investigation of was subsequently extended to cover a number of resolutions adopted by the Consortium in 2001, which were designed to grant monetary incentives to the members of the Consortium for the sale of milk for purposes other than for the production of Grana Padano cheese, of which evidence emerged during the course of the proceedings.
With regard to the 2001 resolutions, the Authority ruled that under section 2 of the Competition Act they were restrictive of competition on the hard 'grana' type cheese production market. These agreements specifically prevented any potential increase in the production of Grana Padano cheese for that year, thereby helping to artificially keep the wholesale prices high.
Considering the serious nature of the offence and the subject matter of the agreement - which, being designed to set production quotas, had seriously restricted free competition - the Authority imposed a fine on the Consortium of EUR 120,000.
With regard to the agreement notified in 2003, which contained measures to guarantee an improved standard of product quality and to institute a new mechanism for subscribing to the Consortium (with the payment of a supplementary contribution for individual members' production surpluses above the historical production quotas of the past eight years), the Authority ruled that since this was to the detriment of producers who had shown themselves to be more dynamic in the past few years, it was likely to discourage any production increases and restrict competition within the meaning of section 2 of the Competition Act.
However, following changes made subsequently to the system for calculating the contribution, and considering the product quality improvements which the agreement could lead to, by enabling consumers to have a better appreciation of the value of the product, as well as the increase in sales, the Authority authorised a derogation for the agreement pursuant to section 4 of the Competition Act, until 31 December 2005.
That deadline would, among other things, ensure that the Consortium would be able to collect the supplementary contribution due for the biennium 2003-2004.
Rome, 10 July 2004