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Finland's top court upholds EUR70m fine on Valio for lowering milk prices

Published 30 December 2016

Finland's Supreme Administrative Court has upheld a decision to impose a fine of €70m on dairy giant Valio for abusing its dominant market position in the domestic milk market.

With the decision, the court has ended a long legal battle between Valio, its rival Arla and local competition authorities over wholesale milk prices in Finland.

In June 2014, the Finnish Market court  imposed the fine on Valio in a case which was referred by the the Finnish Competition and Consumer Authority, YLE News reported.

The court observed that Valio used its dominant market position and decreased milk prices between 2010 and 2012.

Valio CEO Annikka Hume said: “We are disappointed at the decision, but this case is now closed.

“Valio has moved on and we will focus on our strengths: Processing dairy products responsibly and developing world class innovations such as Valio ValSa milk salt and developing and selling attractive consumer products such as tasty, low sugar snacks and protein products that benefit health in Finland and on international markets.”

The company stated that the fine will not affect the price paid for raw milk to the dairy farmer entrepreneurs. The decision means that Valio’s competitors, now get the opportunity to claim damages in the District Court of Helsinki and the process will probably drag for several years.

Valio also noted that the price it pays for raw milk is affected by the success of its consumer products in Finland, Sweden and other markets, the global price levels for industrial products such as milk powder and butter sold in the market and the cost-efficiency of its operations.

Valio’s chairman of board of directors Vesa Kaunisto said: “Valio’s strong equity position and cash assets will serve as a buffer. We’ll have to consider the next 10 years investment programs in Finland.”

Image: Finnish court fines Valio for abusing market position.  Photo: courtesy of nalinratphi/FreeDigitalPhotos.net.