Soap Makers Conspire to Fix Prices, But Can’t Resist Deals

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It’s a soapy sudsy world of deceit: In France, a conspiracy was uncovered recently that saw the major makers of laundry detergent including agreeing on not lowering prices and barring Buy-one-Get-one specials between 1997 and 2004.

There was even a cartel with codenames, according to a story in today’s WSJ.  Biggest kahuna Procter and Gamble was “Pierre” and Colgate-Palmolive was “Christian,” at secret meetings held in restaurants in Paris where the scheme was worked out.  Fines were slapped on the violating companies totaling $384 million in French court.

Finally, Unilever couldn’t abide by the group’s clandestine rules, and went rogue—they offered a “D-Day Special” in June, and that was the beginning of the unraveling of the illegal accord. This began a price war that saw escalating discounts of 25, then 40 percent off. In short order,  the buy One Get One bomb was dropped. It was done, and Henkel, because they ratted out their fellow detergent makers, got immunity from the multimillion euro fines.