Norwegian Salmon Producers Face Antitrust Lawsuit
Norway's biggest salmon-farming companies face a federal class-action lawsuit that accuses them of working together to raise the price of farmed fish.
The plaintiffs, led by Ohio wholesaler Euclid Fish Company, allege that some of the world's biggest producers of Atlantic salmon - including Marine Harvest (Mowi ASA), Bremnes Seashore, Grieg Seafood, Lerøy Seafood, SalMar and Cermaq - worked together to artificially boost prices. This allegedly included common methods of collusion, like coordinating sales prices, and more complex approaches, like buying up lower-priced product from other competitors. The goal, according to Euclid, was to drive up the spot price and - in turn - increase the price paid on long-term contracts that are linked to spot rates.
The suit notes that the European Commission has launched an investigation into similar price-fixing allegations against Norwegian producers. In February 2019, the EC confirmed that it carried out "unannounced inspections" at the offices of several salmon farming companies, and said that it "has concerns that the inspected companies may have
violated EU antitrust rules that prohibit cartels and restrictive business practices." The U.S. Department of Justice has since begun its own inquiry as well.
According to the suit, these producers allegedly used subsidiary companies to buy fish on the spot market, purchasing their own product and competitors' products to prop up the price. “The big players buy fish, and they then use the price as indicators for other customers," alleged Borge Prytz Larsen, a purchasing director for Russian buyer Severnaya, in comments to Intrafish. They would then allegedly report these inflated sales prices to the benchmark NASDAQ Salmon Index, which serves as a reference point for wholesale prices - thereby driving up the rates on their long-term contracts.
"These price increases - and the defendants’ coordinated behavior that caused them - have come at the expense of plaintiff and the class, who have paid more for farm-raised salmon than they otherwise would have in the absence of collusion," alleged Euclid.
The defendants denied these claims and moved to dismiss the lawsuit, but in a decision issued Tuesday, Judge Cecilia M. Altonaga ruled that the case can move forward.