European Commission fines BMW and Volkswagen for “emissions cartel”

(CNN Business)– The European Commission imposed a $ 1 billion fine on the Volkswagen Group and BMW for colluding with Daimler to stop the development of technology that could have reduced harmful emissions from their vehicles.
In a statement issued Thursday, the Commission said the three German automakers, along with subsidiaries Volkswagen, Audi and Porsche, violated EU antitrust rules by agreeing to avoid competing on technical development in the area of ​​cleaning. nitrogen oxide.

The charges relate to conduct that ran from 2009 to 2014, when automakers held “regular technical meetings” to discuss the development of technology that removes harmful nitrogen oxide emissions from diesel cars, according to the Commission. .

“All five automakers – Daimler, BMW, Volkswagen, Audi and Porsche – possessed the technology to reduce harmful emissions beyond what is legally required by EU emissions standards. But they avoided competing to use its full potential. of this technology to clean better than what is required by law, “European Commission antitrust chief Margrethe Vestager said in the statement.

“In today’s world, polluting less is an important feature of any car. And this cartel sought to restrict competition on this key parameter of competition,” he added.

Volkswagen, including its Audi and Porsche brands, was fined € 502 million (US $ 595 million) and BMW € 373 million (US $ 442 million). Daimler was not fined because it revealed the existence of the cartel, the Commission said.

Volkswagen said it would consider appealing the ruling, suggesting it set a questionable precedent.

“The Commission opens a new legal path with this decision, because it is the first time it has pursued technical cooperation as a violation of antitrust laws,” the company said in a statement. “It also imposes fines even though the content of the conversations was never implemented and therefore consumers were never harmed,” he added.

Europe’s largest automaker said the Commission’s guidelines on technical cooperation agreements between automakers “no longer do justice to the complex challenges facing the auto industry” and need to be updated.

The European Commission fined BMW and Volkswagen for colluding to stop the development of emission reduction techniques.

In a statement, BMW said the Commission had “dropped most of its allegations of antitrust violations” and cleared the automaker of suspicion of using “prohibited deactivation devices” to cheat emissions tests. . “This underscores that there has never been any allegation of illegal tampering with emission control systems by the BMW Group,” the company added.

In 2015, Volkswagen admitted to tampering with millions of diesel engines to make their emissions appear less toxic in testing than they actually were. The scandal sparked years of investigations, fines and settlements that have cost the automaker at least $ 39 billion and tainted its reputation.

Last month, former Volkswagen CEO Martin Winterkorn agreed to pay the company nearly $ 14 million after an investigation found it had not responded adequately to indications that the company may have been using illegal technology in its engines. diesel.

Robert North and Charles Riley contributed reporting.