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High prices Nestlé still on hook in Canada price-fixing case

Cadbury's whistleblowing launched a Canadian probe into price-fixing that still has Nestlé Canada in its crosshairs


Canadian authorities pursuing a price-fixing case against two of the world's biggest sweet makers have dropped their charges against Mars but will continue to prosecute those involving Swiss multinational Nestlé, the Canadian Competition Bureau announced on Thursday.

The competition watchdogexternal link unveiled the case in 2013. It stems from allegations of price fixing that resulted in a major class-action suit settled by Mars, Nestlé and confectionery specialist Hershey.

Because Hershey Canada reported communications with competitors related to the price fixing, authorities recommended lenient treatment for that company, which cooperated with the investigation. It pleaded guilty to a criminal charge of price fixing and was fined $4 million.

The competition watchdog initially charged ITWAL Limited, a national network of independent wholesale distributors, and three individuals: Robert Leonidas, the former chief executive of Nestlé Canada; Sandra Martinez, former Nestlé Canada president and David Glenn Stevens, president and chief executive of ITWAL Limited.

But in a statement posted on its website on Thursdayexternal link, the competition bureau said Canadian prosecutors decided to end proceedings against ITWAL Limited, Mars Canada Inc., Martinez and Stevens.

It said, however, the prosecution continues against Nestlé Canada Inc. and Leonidas – but it did not elaborate on why those charges remain and the others were dropped. Nestlé Canadaexternal link says its annual sales in 2012 were approximately $2.2 billion.

The competition bureau also confirmed that a fourth company acted as a whistleblower.

“The charges stem from an investigation launched in July 2007, after the bureau was contacted by Cadbury Adams Canada Inc. under the bureau’s immunity program,” the bureau’s statement said.

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