Confectionery giant Mondelēz fined 337.5 million euros: why one of the sponsors of Russian war in Ukraine was penalized

The American confectionery giant Mondelēz has been fined €337.5 million. The manufacturer of Milka chocolates, Dirol chewing gum, and Oreo cookies and an international sponsor of Russian war in Ukraine was punished for anti-competitive behavior and artificially inflated food prices.

According to the European Commission, Mondelēz prohibited its distributors from reselling products between European Union (EU) countries to artificially inflate prices.

The European Commission has fined Mondelēz International, Inc. €337.5 million for obstructing cross-border trade in chocolate, biscuits and coffee products between member states in violation of EU competition rules... Territorial restrictions on supplies by suppliers are a kind of non-regulatory barriers to the proper functioning of the Single Market," the European Commission said in a statement.

As it became known as a result of the investigation, Mondelēz participated in anticompetitive agreements or concerted actions aimed at restricting cross-border trade in various types of chocolate, biscuits and coffee. In addition, the company abused its dominant position in certain national markets for the sale of chocolate tablets.

Among other things, Mondelēz prohibited certain wholesale buyers from reselling products abroad at higher prices than on the domestic market. Other distributors operating in certain EU member states were prohibited from selling Mondelēz products to customers in other member states without prior authorization from the company.

Mondelēz was also found to have refused to cooperate with some companies and to have broken off cooperation with others to prevent the resale of chocolate tablets to third EU countries.

The Commission concluded that Mondelēz's illegal actions prevented retail customers from freely purchasing the company's products in EU member states at lower prices and artificially divided the internal market. Mondelēz's goal was to prevent prices from being lowered by cross-border trade in countries where prices were high. This illegal practice allowed Mondelēz to continue to charge higher prices for its products, which ultimately caused damage to consumers in the EU," the European Commission said.

As previously reported, in May 2023, the National Agency for the Prevention of Corruption added Mondelēz to the list of international war sponsors. The American company continues to be active in the Russian market, pays taxes, and thus financially supports the aggression against Ukraine. In 2022, Mondelēz's Russian subsidiary paid more than $61 million in taxes to the Russian budget.

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