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Kim Howells decides form of prices remedy for Alanod

United Kingdom
30/04/2000
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On 19th April 2000, Kim Howells announced his decision that Alanod Aluminium-Veredlung GmbH & Co (Alanod) should provide undertakings to put in place a price cap for its customers, following the adverse report by the Competition Commission on Alanod's acquisition of Metalloxyd Ano-Coil Ltd. Dr Howells accepted the advice of the Director-General of Fair Trading that this was the most appropriate form for a remedy to address the adverse effects of the merger on prices, following a consultation on possible options with third parties.

Dr Howells said that he had accepted the CC's unanimous conclusion that this merger may be expected to operate against the public interest, with the specific adverse effect that prices for aluminium coil would be higher than would otherwise be the case. He agreed that the adverse effect would be remedied through behavioural undertakings covering Alanod's prices and other issues.

The price cap will be at the level charged in the year before the merger. It will continue to apply where a customer reduces the volume of their order (within specified limits). Alanod's prices will be allowed to reflect changes in the cost of raw aluminium ingot. The cap will be reviewed five years after the date of the merger.

The final package of undertakings obtained from Alanod, including those on the price cap, will be published in due course.

(DTI Press Release P/2000/286)

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