Nestlé, Mars Accused Of Candy Price-Fixing Conspiracy In Canada

The big names in confection have taken a serious hit, as a five-year investigation into candy price fixing in Canada culminated this week in criminal charges being brought against Nestlé, Hershey, and Mars.

"Price-fixing is a serious criminal offence and today's charges demonstrate the Competition Bureau's resolve to stop cartel activity in Canada," said John Pecman of the Canada Competition Bureau.

The candy-price shenanigans allegedly went down five years ago, in 2007.

According to NBC, Hershey Canada cooperated with the investigation by Canada's Competition Bureau and was expected to plead guilty  "for its role in the conspiracy to fix the price of chocolate confectionery products in Canada."

The Competition Bureau has a program under which the first party to disclose a price-fixing offense like this can receive immunity from prosecution. In this case, that would seem likely to be Hershey.

"Hershey Canada promptly reported the conduct to the Competition Bureau, cooperated fully with its investigation and did not implement the planned price increase that was the subject of the 2007 communications," the company said Thursday in an announcement.

The accused, including two former Nestlé Canada executives, face the possibility of a fine of up to $10 million and imprisonment for up to five years. The Competition Bureau said it could be willing to be lenient to subsequent cooperating parties, but Mars and Nestlé have both denied the allegations.

"Nestlé Canada will vigorously defend these charges," Nestlé announced. "At Nestlé Canada, we pride ourselves on operating with the highest ethical business standards."

Mars was similarly vehement in its denial.

"Mars Canada intends to vigorously defend itself against these allegations," it said. "It is Mars Canada's policy not to comment on pending litigation and we are therefore unable to make any additional comments in relation to this matter, which is now before the court."