[Intl-tobacco] Italy opens price probe into cigarette firms (fwd)

[Robert Weissman]

Italy opens price probe into cigarette firms
Source: Reuters, Wednesday, 7/4/01

ROME, July 4 (Reuters) - Italy's competition regulator said on Wednesday
it had opened an investigation into cigarette companies operating in the
Italian market on the suspicion of price fixing.

The regulator said in a statement the firms under investigation included
the world's two biggest tobacco groups, Philip Morris Co.  and British
American Tobacco Plc.

The others are Japan Tobacco , Imperial Tobacco, Gallaher Group Plc,
Reemtsma Cigarettenfabriken GmbH, French-Spanish Altadis SA , Austria
Tabak AG, Skandinavisk Tobakskompagni A/S and Italian tobacco monopoly
Ente Tabacchi Italiani.

The watchdog, called the Antitrust Authority, said tobacco companies based
in Italy and owned by the groups under scrutiny were also being probed.

``These companies, in occasion of a March 30th price increase and of
previous price increases, may have made agreements aimed
at...significantly limiting or disrupting competition,'' the regulator
said.

On March 30, the price of most cigarette brands was raised by 200 lire
($0.087)  per packet.

``The increases were in fact applied at the same time and uniformly by all
producers, who on each occasion applied the same (price) rises to all main
brands,'' it said.

The watchdog said that, although cigarette prices must be listed in tables
published by the Finance Ministry for taxing reasons, retail prices are
established only according to the requests of producers and importers.

The probe must be concluded by May 31, 2002.