Car companies raided by authorities over suspected cartel activity

Anti-competition regulators in Europe have raided a number of car companies' premises, including Renault and Opel, it was revealed overnight.

The European Commission (EC) – the European Union’s executive branch – announced it had “conducted unannounced inspections at the premises of companies and associations active in the automotive sector” over suspected antitrust violations.

The authority is conducting the investigation alongside the UK’s Competition and Markets Authority (CMA), with “formal requests for information” also being sought from organisations in the industry.

While the details have not been disclosed, it’s understood the investigation relates to local laws which stipulate the ways in which written-off cars must be disposed of or recycled.

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“The Competition and Markets Authority has reason to suspect anti-competitive behaviour has taken place involving a number of vehicle manufacturers, and some industry bodies,” a statement from the UK Government read.

“This conduct relates to arrangements for recycling old or written-off vehicles, specifically cars and vans, which are known in the industry as ‘end-of-life vehicles’ or ELVs.”

Known as the ELV Directive, the regulations are designed to “prevent and limit waste from end-of-life vehicles and their components,” and “improve the environmental performance of all economic operators involved in the life-cycle of vehicles,” according to the EC.

Mercedes-Benz told Reuters it did not expect to be fined as it had approached authorities with information as a “leniency applicant”.

Businesses involved in anti-competitive conduct may be granted immunity in exchange for reporting cartel activity and assisting the CMA with an investigation.

Both Renault and Opel confirmed to Reuters their offices had been visited by investigators, while information had been formally requested from BMW. All three brands said they were cooperating with the regulators.

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“Unannounced inspections and requests for information are a preliminary investigatory step into suspected anticompetitive practices,” the EC said in a statement.

“The fact that the Commission carries out such inspections and sends out formal requests for information does not mean that the companies are guilty of anti-competitive behaviour nor does it prejudge the outcome of the investigation itself.”

Organisations involved in anti-competition activities can face fines of up to 10 per cent of their global turnover, with the European watchdog handing out around €2.2 billion (AU$3.35 billion) in penalties over the past decade.