Industrial insurers withdraw appeals against Bundeskartellamt’s orders imposing fines

Following AXA Versicherung AG’s withdrawal last week of its appeal against the Bundeskartellamt's order of March 2005 imposing fines against a number of industrial insurers, HDI Haftpflichtverband der Deutschen Industrie V.a.G and Gothaer Allgemeine Versicherung AG as well as individuals personally involved have now also withdrawn their appeals against the Bundeskartellamt’s decision. The withdrawals concern the entire industrial property sector and thus by far the most significant target of the accusations made by the Bundeskartellamt. The insurance companies Allianz and Württembergische Versicherung had already withdrawn their appeals before the beginning of the court proceedings. The pilot proceedings of the Düsseldorf Higher Regional Court in the matter concerning the industrial insurers have thus now been concluded. Fines imposed by the Bundeskartellamt in that matter totalling approx. € 96 million have now become final.

In 2005 the Bundeskartellamt had imposed fines totalling approx. € 150 million against 18 insurance companies and 22 directors involved. The cartel law violation had a nation-wide and cross-industry effect on, in particular, the industrial property insurance sector (fire, consequential loss, EC and All-Risk insurances, and technical insurances) as well as the transport insurance, buildings/monopoly insurance and travel insolvency insurance sectors. According to the Bundeskartellamt’s findings, in the middle of 1999 the insurers concerned had agreed to put an end to the intense competition at that time in premiums and conditions in order to raise premiums and introduce changes to terms and conditions.

The industrial insurers have now decided to withdraw their appeals just at the stage of the proceedings when the court had largely finished taking evidence against AXA Versicherung AG, HDI Haftpflichtverband der Deutschen Industrie V.A.G. and Gothaer Allgemeine Versicherung AG and had commissioned experts with the calculation of the possible proceeds earned from the cartel. The Düsseldorf Higher Regional Court has the possibility to deviate from the fine set by the Bundeskartellamt not only downwards but also upwards.

A number of appeals against the outstanding fines, totalling approx. € 54 million, have to be heard by the court at a later date, assuming that the companies do not also withdraw these appeals in the meantime.