EU fines auction house Sotheby's 20.4 million euro for colluding with
Christie's
BRUSSELS, Belgium, Oct 30, 2002 (AP WorldStream via COMTEX) -- The European
Commission on Wednesday fined the Sotheby's, the New York-based auction house,
20.4 million euros ($20.1 million) for colluding with rival Christie's to fix
commission fees, prices and trading conditions in art sales between 1993 and
2000.
London-based Christie's escaped a fine because it provided evidence to the
European Union regulators which enabled them to prove the existence of the
cartel.
The case turned on fixing commissions for sellers of art works, trading and
payment conditions and as well as auction outcomes.
The EU head office said the cartel was initiated by Alfred Taubman and Sir
Anthony Tennant, chairmen of Sotheby's and Christie's respectively, in 1993 and
faithfully executed by senior officials in both companies.
The EU finding follows action in the United States where Sotheby's was sentenced
to pay US$45 million.
Christie's was also granted an amnesty in the United States for cooperating with
investigators although it agreed to share the costs of a US$537 million
settlement of price-fixing lawsuits brought by customers of the two houses.
Sotheby's and Christie's have already agreed to pay $512 million to some 130,000
art buyers and sellers who brought a class-action lawsuit against the houses for
fixing fees at U.S. auctions.
Unlike in Europe, running a cartel in the US can also carry a prison sentence.
Taubman is serving a one-year jail term after being found guilty last December
of hatching the conspiracy with Tennant, his Christie's counterpart. Taubman
must pay a fine of $7.5 million.
The fine for Sotheby's amounts to 6 percent of the company's worldwide turnover
last year. Under EU rules, the maximum antitrust fine cannot exceed 10 percent
of turnover.
"No fine was imposed on Christie's because Christie's came to the Commission ...
and provided decisive evidence," said Amelia Torres, antitrust spokeswoman for
the EU Commission.
In a reaction, Sotheby's stressed it has "cooperated fully" with the EU probe.
"As the fine is materially less than it could have been, we are very pleased to
have the investigation behind us," said Bill Ruprecht, the company's chief
executive said.
A spokesman at Christie's said the company was "pleased that this brings this
chapter in the art market closer to a conclusion."
The EU Commission said the price fixing and collusion in trading conditions kept
the auction houses from setting prices individually.
"The purpose of the cartel agreement was to reduce the fierce competition
between the two leading auction houses that had developed during the 1980s and
early 1990s," the Commission said in a statement.
The deal involved agreed increases in commissions paid to sellers of art works
as well as trading conditions, guaranteed auction outcomes and conditions of
payment.
Christie's and Sotheby's are the leading players in the global art auction
market.
Christie's was established in 1766. It has been a subsidiary of the French
Artemis SA company since 1998. Sotheby's, also founded in the 18th century, is
publicly listed on the London and New York stock exchanges. Taubman is its major
shareholder.
By ROBERT WIELAARD
Associated Press Writer
Copyright 2002 Associated Press, All rights reserved
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Eds: UPDATES with reactions from Sotheby's, Christie's
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