Cemex, Holcim, Cementos Argos face cartel allegations in Colombia
Cemex, Holcim and Cementos Argos have 20 days to respond to allegations of cartelisation in the Colombia’s cement market. If the evidence against the companies is found conclusive, they could be subject to fines of up to COP70bn (US$23.9m) per infraction.
The investigation started in August 2013 when the Superintendency of Industry and Commerce (SIC) opened an investigation and formulated a statement of objections against Cementos Argos, Cemex, Holcim, Cementos Tequendama, Cementos San Marcos and 14 of its main executives. The reports says that Holcim, Cementos Argos and Cemex have agreed to fix cement prices between 2010-12, causing a rise of up to 30 per cent in the value of concrete and divided the market to establish exclusive areas for the commercialisation of concrete. The SIC recommended absolving Tequendama and San Marcos.
In a statement, Cementos Argos has refuted the allegations saying the basis of the recommendation is unsound.
“The report supports the recommendation in an alleged price parallelism between 2010 and 2012, assuming it was a conscious event. Alleging price parallelism considering a statistical analysis for 36 months, in a period of high demand growth and economic expansion, is not appropriate,” says Juan Esteban Calle Restrepo, CEO of Cementos Argos.
“The report mentions that prices showed a growing continuous trend during the expansive cycle, but the reality is that the cement prices, when analysed in longer period have increased less than inflation and the minimum wage. For example, 15 years ago a Colombian could purchase 18 cement bags with a minimum monthly wage, and today 35 bags can be afforded.
“The alleged market allocation, which has not happened, is based, according to the report, on stable market shares from competitors during the analysed period. Argos has presence throughout the country without limit or restriction, proudly serving millions of Colombians. Our markets share from 2010 to 2012 has experienced variations of over 200 basis points nationally and even more on a regional basis. If we analyse a longer period, in the past 10 years, the variation is more meaningful. In Argos, our market share passed from approximately 50 per cent in 2007 to 43 per cent year to date in 2017.”
Holcim, for his part, responded to the controversy that the company complies with the rules of free competition, and reiterated "that at no time have we made any agreement with our competition”. Moreover, the company also stated that it will continue "presenting strong arguments to the SIC in the different opportunities that remain within the process."
Cemex recalled that it has a period of 20 days to submit observations and that it will file a petition for reinstatement if it is sanctioned by the authority.
