Finnish Market Court annuls €44 million penalty payments in HVAC infra plastic pipes cartel

Compass Lexecon assisted Kesko Oyj and its external counsel Frontia Attorneys during the investigation by the Finnish Competition and Consumer Authority ("FCCA") into alleged anti-competitive practices in the heating, ventilation, and air-conditioning (“HVAC”) piping market, and the subsequent process in front of the Market Court. The Market Court fully dismissed the €44 million penalty payments proposed by the FCCA in August 2024.

Situation

The FCCA investigated alleged anti-competitive collaboration by manufacturers and wholesalers in the market for plastic HVAC infrastructure pipeline products. These products are mainly used in the construction sector. Kesko’s subsidiary Onninen was one of the pipe wholesalers being scrutinized. Kesko’s counsel engaged Compass Lexecon to provide economic advice.

Our Role

We analysed the economic effects of the alleged cooperation between infrastructure pipeline manufacturers and wholesalers, where we assessed both the horizontal and vertical effects of the conduct. We submitted an economic report to the Market Court with our findings and expert Otto Toivanen, academic affiliate with Compass Lexecon, testified at the Court hearing.

Outcome

In September 2022, the FCCA had proposed to the Market Court to impose penalty payments on six companies, including Onninen, following an almost decade-long investigation. The Market Court decided in August 2024 to dismiss the penalty payments totalling €44 million and ordered the FCCA to reimburse companies for their litigation costs.

The Team

The Compass Lexecon team was led by Pekka Sääskilahti and Otto Toivanen and also included Lotta Väänänen, Timo Autio, Eeva Hietamäki, Juho Anttila, Andrey Zhukov, Jussi Kerttula, Alex Wiik, Janne-Matti Kinnunen, Janne Sirniö, Krista Kuuttiniemi, and Roni Luokkamäki.

The team from Frontia Attorneys, led by Mikael Wahlbeck and Antti Järvinen, included Pirjo Uimonen and Anette Laulajainen.