The service is allowed to operate as a natural monopoly, as reported by the Wall Street Journal, because having more than one identification system would complicate the trading system. While accepting this fact, the EU’s investigation is looking into whether or not Standard & Poor’s is overcharging for the service.

A spokesperson for S&P told the Wall Street Journal that the company “strongly disagrees with the EC’s preliminary assessment and believes the Commission has grossly undervalued Standard & Poor’s effort, expertise and costs required to operate a global identification system that benefits millions of investors and market participants world-wide.”

“The Commission has reason to believe that there may have been a violation in this sector of rules on restrictive business practices (Article 81),” the EC said in a prepared statement.

Commentary: The Commission pointed out that raids and inspections are a “preliminary step” in larger cartel and anti-trust investigations. Still, one has to be suspicious because of the high-profile raids and large dollar amount fines levied against glass companies at the end of last year. Although the information on the special glass sector raids is just now becoming known, the Commission admitted it began investigating in March of 2009, fresh off the case of the earlier, 2008 glass cartel.

The wax cartel has been operating since 1992, meeting in “top hotels” across Europe between then and 2005. Neelie Kroes, the EU Competition Commissioner, said, “There is probably not a household or company in Europe that has not bought products affected by this ‘paraffin mafia’ cartel, with all that implies in terms of paying over the odds, higher costs and economic damage.”

Of the nine companies involved in the fine, South Africa’s Sasol was burdened with the largest percentage, nearly 50 percent, because the EC deemed it the ringleader. The next largest fine, €128.1 million, was slapped on France’s Total. ExxonMobil landed third place with €83.6 million. The rest was divvied up between Spain’s Repsol; Italy’s Eni; Germany’s Tuda-petrol, Hansen & Rosenthal and RWE; and Hungary’s MOL.

Shell was given immunity because it blew the whistle on the group, avoiding a potential fine of €96 million.

Sasol said if it found grounds to appeal the fine, it would. Apparently the company feels it has enough information to do so, as CEO Pat Davies said, “As we see things now, we intend to appeal.” However, appealing may not be enough to rid the companies of any and all financial damage, as the EC encouraged individuals or companies who were victims of the cartel to seek damages as well.

The European Commission said that the raids were the tip of the iceberg as far as the investigation is concerned, and they’re still gathering data on the issue. The raids were not an accusation of guilt on the part of the companies.

In explaining the new precedent of unannounced visits, the ever aggressive Neelie Kroes said:

“If we have the feeling that something is rotten in the state, then let’s take the opportunity to find out.”

According to the FT story, the generic drug companies have been raising their eyebrows for some time, accusing big pharmaceuticals of using shifty means to delay them from producing cheaper, identical drugs.

Many experts argued that the European Court of First Instance’s ruling against Microsoft this year would embolden the European Commission (and Neelie Kroes) to become much more aggressive in big-business litigation and, for the moment, it would seem they are right. For example, the EU gave Google “one of very few major business challenges” in the company’s history when competition authorities at the European Commission didn’t approve Google’s acquisition of online advertising company DoubleClick.

There is a method to her madness, however, as Kroes and the Commission’s actions are successfully putting the European Union’s antitrust authority into international celebrity as other countries around the world (such as South Korea) begin to model their own systems off the European style – and as their U.S. counterpart loses its influence.

First, he praised international anti-cartel enforcement. “Authorities around the world are united in a commitment to pursue hard core anticompetitive conduct,” Barnett said. “With more antitrust enforcement agencies on the beat, cartels run a greater risk of detection.”

Near the end of his speech, however, he discussed the “unduly restrictive standards” resulting from unilateral conduct on antitrust enforcement.

Barnett says these standards “can have the unfortunate consequence of harming consumers by chilling innovation and discouraging competition.”

This is an obvious reference to his remarks immediately following the Court of First Instance’s decision to throw out Microsoft’s appeal (which EU’s antitrust commissioner Neelie Kroes immediately rebuffed).

Barnett claimed after the symposium that his statements were not directly related to the EU’s Microsoft decision.

Philip Verveer, a former Justice Department official, finds that unlikely. “This is an issue that is very current and it is one where our antitrust authorities have increasingly taken the view that single-firm conduct, except in very unusual circumstances, is unlikely to be harmful to consumers,” he said.

Critics of the record-high cartel fines present two arguments: (1) companies will eventually raise consumer prices to compensate for their losses; and/or (2) the penalties are so high that further increases won’t make a difference.

EC Competition Commissioner Neelie Kroes countered these arguments when the EC announced its €990 million fine against various elevator manufacturers in February: “The damage caused by this cartel will last for many years . . . the memory of this fine should last just as long.”

Commentary: This is a trend that we have been predicting for some time. It’s one more reason for global corporations to beef up their European compliance and ethics programs. To add even more fuel to this growing need, German prosecutors are now lobbying for new laws embracing criminal penalties for corporations.

For those that haven’t been paying attention, in 2004 the European Commission handed Microsoft a $613 million fine for antitrust violations, particularly in regard to the bundling of Windows Media Player with Microsoft’s Windows Operating System. Microsoft appealed and, three years later, the EC’s decision became final.

M. J. Moltenbrey, a Washington based antitrust lawyer, had this to say:

“It is inevitable that global companies that want to have a consistent policy around the world will adapt to the regime that is the most restrictive as the relevant standard. Companies will worry about the agency that is the most interventionist, and at the moment, it is the European Commission that seems more willing to intervene in markets.”

Other opponents of the decision say that the decision will turn Europe into the “litigation capital of the world” and will create more lawsuits against other major companies such as Intel and Apple. However, European Commission officials claim the only company that will be affected by this ruling is Microsoft.

Read more on the story here.

The study began in 2004 by the University of Southampton and tested the effect of specific additives on children aged 3-4 and 8-9 years old. One of the additives brought into question is known as sodium benzoate which is found in “soft drinks, jams and salad dressings.”

Check out Financial Times for the full article.

The Belgian Federation of Wine and Spirits, a member of the EFWSI, sent a separate letter to authorities stating that three companies, Saint-Gobain of France, Owens-Illinois of the U.S. and Ardagh Glass of Ireland control over 95% of the European glass bottle industry.

Read the complete story in CNN Money.

At issue is that the four companies (which control 95% of the colostomy bag market in the country), illegally agreed to divide the country into territories where they would not compete against each other.

Commentary: In looking at the statements coming out of the Italian government, it is not clear why BMS got the biggest fine… were they the ringleader? Or simply the one that benefited most? Either way, looks like BMS could use some compliance training for their European subsidiaries.

If found guilty, the companies face fines of up to 10% of their sales in the areas where the illegal collusion occurred.

Commentary: Akzo seems to be doing its best in vying for most corrupt/fined European company of the decade. They were fined $110 million in 2005 for fixing the prices of MCAA (a chemical used in detergents, food and cosmetics), and in 2006 they paid $32 million for their involvement in a hydrogen peroxide cartel. Akzo also confirmed earlier this year that it was being investigated by the EU for possible price-fixing in its sales of the chemical calcium carbide.

On a separate note, the importance of a good M&A attorney will be shown in the Kemira Oyj proceedings. The subsidiary being investigated, Finnish Chemicals Oy, was acquired in 2005, but the cartel being investigated allegedly occurred between 1994 and 2000. Did Kemira negotiate any such potential liability to be left with the seller?

Now the price has come in and BA and Korean Air Lines have both agreed to plead guilty to price fixing and to pay $300 million apiece for conspiring to fix the prices of passenger and cargo flights.

BA was also separately was fined a record $250 million in Britain after admitting collusion over fuel surcharges on tickets.

Virgin Atlantic was the airline which blew the whistle last year on BA’s collusionary habits – and thereby escaped punishment.

Commentary: Believe it or not, this penalty in some ways is a relief to British Airways, as it could have been fined up to 10% of revenues (as opposed to just 1%, as this fine represents).

That being said, British Airways is not out of the woods yet. Next up for sure will be a class-action lawsuit, probably filed in the U.S. (at least initially) by passengers looking for trebled damages.

If determined to be guilty, Intel faces up a fine of up to 10% of its European sales during the period of alleged infraction – which could be enormous.

Then we go to Hungary, where the news wasn’t much better for the other partner in the Win-Tel alliance: Microsoft.

According to media reports, Hungary’s state Competition Authority (also known as GVH) conducted unannounced raids on the offices of the local subsidiary of Microsoft last week over suspicions that the company was abusing its market power in its relationship with large software distributors.

At issue are the “loyalty discounts” that Microsoft uses with its existing software distributors – which make it very economically unattractive of the distributors to carry any software other than Microsoft Office.

Investigators found that between 1997 and 2003, the operators regularly exchanged information about new and canceled contracts and used this information to maintain their market shares and match commercial strategies.

While the Conseil did not find specific evidence of price fixing, it did consider that the exchange of information restricted competition by allowing the three operators to react to one another’s marketing strategies.

Commentary: One interesting element of this case is that regulators did not find specific proof of price-fixing, but simply inferred it from the other information that was exchanged – that information, in regulators’ minds, would have been enough to coordinate strategies on product services, offerings, billing practices (and thereby resultant pricing).

On the positive side, we can commend the French school system for its history curriculum – one of the handwritten documents unearthed in discovery referred to the practices as a “market-share Yalta” among the competitors which would “pacify the market” (a reference to the historic 1945 agreement between Russia, the U.K. and the U.S. to partition post-war Europe influence).

This is the third time that the commission has ended a probe into the chemicals industry in a year. While no reason has been given by the commission for the investigation’s end, it’s likely that the case lacked the evidence it needed (which is what typically spurs the end of an EU probe).

Commentary: Nice to see this dropped. Just because there is an investigation does not always mean that there has been a crime.