2023-09-22 00:42:37
The Nuremberg-based arms manufacturer Diehl has to pay a fine of 1.2 million euros for an unlawful market agreement with a competitor. The EU Commission imposed the fine after a settlement procedure, as the EU authority announced on Thursday.
“Today we are fining Diehl because the company formed a cartel with its competitor RUAG that affected the sale of hand grenades,” said EU Competition Commissioner Didier Reynders. A spokesman for the Diehl defense division confirmed the information.
It is the first antitrust decision in the defense sector. “At a time when geopolitical realities are changing, it demonstrates that we will not tolerate cartels in any sector of the economy, including strategic sectors,” said Commissioner Reynders.
Both companies admitted participation in the cartel and agreed to the settlement. RUAG does not have to pay a fine because the company informed the EU Commission as part of a leniency program. The fine for Diehl was reduced by 50 percent because the company cooperated with the commission. A further reduction occurred because Diehl admitted the allegations.
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The investigations revealed that the two companies had divided the markets for military hand grenades in the European Economic Area for almost 14 years. Only the manufacturer assigned to a specific area was allowed to sell military hand grenades there, unless there was express consent from the other.
In recent months, Diehl has become known as a supplier of the Iris-T air defense system, which Germany is supplying to Ukraine to support the war against Russia.
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