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EC and De Beers Still Talking About Russian Contract - April.2003
The European Commission (EC) has extended the deadline for De Beers
and ALROSA to reply to the Statement of Objections to De Beers’
Russian contract from March 17 to March 31, 2003.
In the Statement of Objections the EC warned De Beers and ALROSA that the trade
agreement they signed in December 2001 might be in breach of EU competition
rules. The agreement would have committed ALROSA to sell De Beers $4 billion
worth of diamonds over a five-year period.
The EC’s main concern is that the agreement might restrict competition on the
rough diamond market by eliminating competition from ALROSA
believed that De Beers abused its dominant position by entering into the
agreement in the first place.
Meanwhile, discussions between all parties continue. "They (the EC) ask a
question, we give a reply. Information is going to-and-fro between the
parties," explains Simon Gilbert, De Beers Corporate Affairs Manager.
An EC spokesperson says the extension is not unusual as there is no legal
deadline for companies to reply to such an investigation. Once the parties
reply, the EC antitrust authorities will need several weeks to examine their
arguments. The Commission will also give the parties the opportunity to develop
their arguments at an oral hearing, if requested. v |
