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AFCA confirms dawn raids in wood pellets market

The Austrian Federal Competition Authority (AFCA) has carried out dawn raids in the wood pellets market. Pellet producers and pellet traders are suspected of having fixed prices and divided up customers, as well as having restricted and controlled markets together. Several companies and one association have been investigated, with dawn raids being conducted in the Austrian provinces of Vienna, Carinthia and Tyrol.

Affected market

Wood pellets are used as a form of biogenic fuel. They are a necessary part of Austria’s energy supply, with 4% of all Austrian households using pellets for heating. In 2021, 1.6 million tonnes of pellets were produced in Austria, 1.2 million tonnes of which were used in Austria. According to Statistics Austria, there has been a slight decline in pellet exports in 2022 compared with 2021, with imports also minimally down. Pellets from Russia or Ukraine make up only 1% of all Austrian imports.

“Heating is a basic need. The current crisis must not be further exacerbated by illegal practices. We therefore look into all information we receive,“ explains interim Director General Natalie Harsdorf-Borsch.

Ban on cartels

According to § 1 of the Austrian Federal Cartel Act (KartG), any agreements restricting competition are prohibited. Specifically, price fixing arrangements, the limitation or control of production and markets, and the division of markets are prohibited. The Cartel Court may impose fines of up to 10% of a company’s total turnover if that company is found to have breached cartel law.