UPDATE 2-Reckitt fined $32 mln by Germany for price-fixing

Wed Nov 23, 2011 8:18am EST

* Reckitt fined 24 mln euros for incidents from 2005-07

* Whistleblower Henkel escapes fine

* Prices fixed on dishwashing, laundry, cleaning products

* Reckitt shares up 0.1 percent at 3,175 pence

By Victoria Bryan

FRANKFURT, Nov 23 (Reuters) - British consumer goods maker Reckitt Benckiser Group Plc was fined 24 million euros ($32 million) by the German cartel office on Wednesday for fixing prices on dishwashing and laundry products with German rival Henkel AG & Co.

The fine was imposed on Reckitt and one of its employees after it was accused of illegally coordinating dishwasher detergent prices and exchanging competitive-sensitive information. The Reckitt employee, who was not named, no longer works for the company, said a source with knowledge of the situation.

The authority said it had found four instances between mid-2005 and mid-2007 where Reckitt's German unit and Henkel fixed prices, such as by increasing prices for Reckitt's Calgonit dishwasher detergents, known as Finish in other markets, and Henkel's Somat.

The fine follows big penalties on Unilever Plc/NV and Procter & Gamble Co earlier this year for fixing washing powder prices, and after Reckitt was fined 10.2 million pounds last year for abusing its dominant position in Britain for the supply of heartburn medicine Gaviscon.

The German cartel office said Henkel escaped a fine after acting as a whistleblower and instigating the investigation in 2010, while Reckitt's fine was reduced due to its cooperation in the investigations.

REDUCED SIZES

"The two companies coordinated price rises for their products over a period of years. Customers paid dearly for this," said Andreas Mundt, president of the cartel office, in a statement.

In one of the incidents, the two agreed to reduce the sizes of the boxes for Calgonit and Somat dishwasher tablets, thus indirectly increasing the price per box by 13 percent, the cartel office said. The case also involved other products like Reckitt's all-purpose cleaners Cillit Bang and Henkel's Bref, and fabric cleaners Vanish Oxi Action and Sil.

Reckitt's fine also included a penalty in a separate case in which consumer goods firms were fined for sharing sensitive information following a tip-off from U.S. group Colgate- Palmolive Co.

The cartel office had already fined eight companies a total of around 20 million euros in 2008 in connection with that investigation.

A spokesman for Henkel said it had worked with the authorities following that case, and the price-fixing fine for Reckitt came about as a result.

Reckitt confirmed it had agreed to pay the fine, but declined to comment further.

The penalties were well below the 315.2 million euro fine for Unilever and Procter & Gamble in April this year, with the former fined 104 million euro and the latter 211.2 million by the European Union for fixing washing powder prices in eight EU countries.

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