The European Commission fined New York-based International Flavors & Fragrances Inc. and its French counterpart (“IFF”) yesterday the equivalent of $17 million for obstructing an investigation. During a search of employees’ mobile phones while scouring IFF facilities last year, an investigator discovered that a senior executive deleted WhatsApp messages he had exchanged with a competitor while the Commission’s probe of the industry was under way.
The Commission considers the intentional deletion of business-related messages, i.e., potential evidence, after being informed of an inspection a very serious infringement.
This is the first time the Commission imposed a fine for deleting messages generated on social media apps during an inspection, emphasizing the evolving nature of compliance requirements in digital communication.
It could have been worse – to the tune of $34 million – but, because IFF cooperated, the Commission cut the fine in half from 0.3% to 0.15% of the company’s profits.
IFF generates $11.5 billion a year, roughly a quarter of industry revenues globally. The global flavor and fragrance market amounted to $43 billion in 2023, according to figures compiled by Statista. Four companies control half of the global market. In addition to IFF, the dominant players are Swiss-based Givaudan, German-based Symrise, and, another Swiss company, Firmenich, now called DSM-Firmenich following a 2023 “merger of equals” with DSM.
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