Synthos makes recourse claim to Ineos following cartel fine

OSWIECIM, Poland—Synthos S.A. has made a recourse claim to Ineos after the European Commission imposed a penalty on the company for involvement in cartel activities for the purchase of styrene.

In a Nov. 29 decision, the European Commission fined five companies, including Synthos, a total of $165 million (€157 million) for participating in a cartel concerning purchases on the styrene monomer merchant market.

Other companies fined were Sunpor, Synbra, Synthomer P.L.C., and Trinseo, while United Kingdom chemicals giant Ineos was not fined due to it revealing the cartel under the Commission's "leniency program."

According to the commission, unlike in most cartels, where companies conspire to increase their sales prices, the six companies involved in this case "colluded to lower an element of the price of styrene."

In particular, the commission said, the companies "coordinated their price negotiation strategies" prior to and during the bilateral styrene monthly contract price settlement (SMCP) negotiations with styrene sellers.

This, it said, helped the companies to "influence the SMCP to their advantage."

The infringement was carried out between May 1 and June 30, according to the commission.

In a statement in response to the commison's decision, Synthos said it only became involved in the activities following its purchase of Ineos' styrene business in August 2016.

The acquisition, Synthos said, resulted in the "automatic transfer of a key Ineos employee who had been involved in the breach … of which Synthos was unaware."

"Through the business acquisition contract," Synthos said it "obtained a legal guarantee from Ineos that the acquired enterprise was operating in compliance with the law, in particular with antitrust regulations.

Based on these contractual guarantees, Synthos said it had made a recourse claim to Ineos in relation to the penalty imposed by the commission.