Novamont Fined Over 30 Million Euros For Monopolizing The Italian Biodegradable Plastics Market

Jul 02, 2025

Novamont fined over 30 million euros for monopolizing the Italian biodegradable plastics market

 

Recently, the Italian Competition and Market Authority (AGCM) fined bioplastics manufacturer Novamont S.p.A. 30.4 million euros, and its parent company ENI S.p.A. was fined an additional 1.7 million euros for joint liability. The reason is that Novamont abused its dominant position in the market for bioplastic raw materials for light and ultra-light fruit and vegetable bags between January 1, 2018 and December 31, 2023, and suppressed competitors through exclusive clauses.

 

Investigation background and violations

 

According to Italy's Legislative Decree 152/2006, from July 3, 2021, all shopping bags and ultra-light plastic bags in the country must use biodegradable and compostable materials (biodegradable and compostable), and the content of renewable raw materials in ultra-light bags must not be less than 60%.

 

Novamont has developed a compliant product, Mater-Bi (mainly composed of a blend of PBAT and starch), and has a national leading position in the production of bioplastics for shopping bags (market share of more than 50%) and ultra-light bags (market share of more than 70%).

 

The AGCM investigation found that Novamont has built a dual-level supply agreement system, and has achieved market blockade by setting exclusive clauses in two links of the supply chain.

 

Specifically, for processors: restricting them to only purchase Mater-Bi raw materials, blocking competitors from entering the market. Processing companies subject to this constraint account for about 52% of the national demand for bio-based compounds for shopping bags in Italy, and 70% of the demand for ultra-light bags.

 

For large retailers: requiring them to purchase Mater-Bi finished bags only from Novamont's cooperative processors. During the period under review, large retailers contracted by Novamont accounted for 44% of the total demand for shopping and ultralight bags in the retail industry and a large part of the revenue of Novamont's affiliated processors (up to 51%).

 

This system has formed an exclusionary effect on Novamont's competitors through a circular mechanism, and the specific chain of action is as follows: Exclusive purchases by large retailers trigger a chain reaction.

 

As long as the mainstream large retailers agree to purchase Mater-Bi brand bag products only from Novamont's partner processors, these processors have a strong incentive to accept the exclusive terms proposed by Novamont. The binding of processors strengthens the market closed loop.

 

As long as the main processors supplying large retailers are subject to Novamont's exclusive terms, large retailers will benefit from contracts with Novamont that contain incentive exclusivity clauses and/or incentive mechanisms.

 

AGCM pointed out that this monopolistic behavior not only undermines market fairness, but also hinders the development of more efficient and environmentally friendly alternatives, which goes against the legislative goals of the EU and Italy to promote ecological transformation.

 

Novamont responded: Dispute and defense

 

Novamont expressed "shock and regret" at the ruling, saying that its business behavior is aimed at promoting local innovation in Italy, and emphasized that the company has built a bioplastic industry chain from scratch, and established a sustainable production model through scientific research investment, abandoned factory transformation and cooperation network;

 

currently 25% of plastic bags in the Italian market are non-compliant, and Novamont has improved industry standards through strict quality control. The antitrust ruling will "encourage low-quality imported products."

 

The company plans to defend its rights through judicial procedures and said that AGCM has not fully considered the social value of its technological innovation.

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