Top German brewers are under investigation for allegedly fixing beer prices for nearly two decades, according to a new report by the German weekly Focus. The beer giants may face hundreds of millions of euros in fines.
Germany’s Federal Cartel Office is scrutinizing roughly a dozen breweries, including multinationals Carlsberg (CARLB:DC) and Anheuser-Busch InBev (BUD) (the maker of Beck’s), and family-owned businesses like Erdinger and Bitburger. Until recently, authorities suspected that collusion occurred only from 2006 to 2008. Now, a more than 100-page report, compiled by the Federal Cartel Office and shared with Focus, says those years were “most likely just the tip of the iceberg.”
Carlsberg confirmed in an e-mail that it had been contacted by the authorities and said, “We take this matter very seriously.” AB InBev pointed out that proceedings of the Federal Cartel Office are always confidential and declined to comment further. Erdinger and Bitburger also declined to comment.
During a Jan. 31, 2013, questioning, Volker Kuhl, head of the Veltins brewery, told investigators that during his 17 years in the business, premium beer brands regularly colluded to raise prices, speaking via telephone or at meetings. They then passed the information on to midsize and smaller producers. “Then it often came to a branchwide hike in beer prices,” Kuhl explained, according to Focus. Similar claims were made by other leaders of brewing groups and associations.
Reports of widespread price fixing aren’t the only instance of bad news for Germany’s beer industry in recent years. National beer consumption is on the decline, and the number of German breweries has fallen by roughly one half in recent decades, according to Slate. Germans have even coined a new word, brauereisterben, to describe this “brewery death.”
Higher prices may have contributed to Germany’s beer woes, but busting cartels may not solve that problem. “If they have to pay high fines, and damages, the breweries will have to recoup that money somehow,” one expert told German news channel n-tv. “That’s why they won’t lower prices.”
