The European Commission has fined International Flavors & Fragrances Inc. (IFF) and its French affiliate IFF France SAS a total of €15.9 million for obstructing an antitrust inspection in 2023. The Commission found that during the inspection, a senior IFF employee deliberately deleted WhatsApp messages exchanged with a competitor.
Commission’s Investigation
In March 2023, the Commission conducted inspections at the premises of companies active in the consumer fragrance industry as part of an investigation into a suspected fragrance cartel. During the inspection of IFF, the Commission detected that a senior employee had deleted WhatsApp messages containing business-related information after being informed about the inspection. IFF immediately acknowledged the facts, helped the Commission recover the deleted data, and cooperated fully with the investigation. In March 2024, the Commission opened proceedings against IFF for obstructing its investigation. IFF engaged in a cooperation procedure by acknowledging liability and accepting the maximum fine amount.
The Fine
Under Regulation No 1/2003, the Commission can impose fines of up to 1% of a company’s total turnover for intentionally or negligently obstructing an antitrust investigation. In setting the fine amount, the Commission considers the gravity and duration of the infringement. The Commission deemed IFF’s infringement very serious, given the senior employee’s intentional deletion of messages after being informed about the inspection. The Commission was not informed of the data deletion, and inspectors had to detect it themselves after the mobile phone was submitted for review. The Commission concluded that a fine of 0.3% of IFF’s total turnover would be proportionate and deterrent. However, the fine was reduced by 50% to €15.9 million (0.15% of IFF’s turnover) due to IFF’s proactive cooperation. This is the first Commission decision imposing a fine for deleting messages exchanged via social media apps on a mobile phone during an antitrust inspection. The Commission’s investigation into the fragrance industry (AT.40826) remains ongoing and is unrelated to this decision.
Background
Regulation No 1/2003 empowers the Commission to conduct inspections at the premises of companies suspected of breaching EU competition rules. Companies must submit to inspections ordered by the Commission and take measures to preserve available evidence. The Commission’s inspection teams include forensic IT experts who use cutting-edge tools to detect any deletion or manipulation of electronic information during inspections. The Commission continuously invests in its forensic capabilities to ensure effective detection of information tampering. The cooperation procedure allows companies to acknowledge liability for an EU competition law infringement and obtain a fine reduction in exchange for a simpler and faster procedure.
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