Introduction and background

On 10 June 2025, the Italian Competition Authority (“ICA”) fined Novamont S.p.A. (“Novamont”) and its parent company, Eni S.p.A. (“Eni” and, together with Novamont, the “Companies”), for an exclusionary strategy deemed by the ICA to be an abuse of a dominant position in the national markets for raw materials used in the production of lightweight (LPB) and ultra-lightweight bags (VLPB).

The investigation focused on the supply of “bio-compounds” used to produce LPB and VLPB shopping bags, which are required by Italian law to be biodegradable and compostable. 

Relevant market and dominant position

The ICA investigation revealed that Novamont acquired a dominant position in both the LPB and VLPB markets, thanks to the development of its compliant product, Mater-Bi. More specifically:

• over the years, Novamont’s share in the LPB segment often exceeded 50%, and in the VLPB segment it repeatedly climbed above 70% - in both cases well above the 40% threshold typically indicating market power;
• by contrast, the second-largest operator never exceeded 10–15% in LPB or 20–25% in VLPB, underscoring a significant gap that allowed Novamont to face only minimal competitive pressure.

These consistently high and stable shares, coupled with Novamont’s control over key input and its exclusive distribution arrangements, led the Authority to conclude that the company could effectively operate independently of competitors in both markets.

The alleged abuse of dominant position

The ICA found that Novamont abused its dominance through exclusionary agreements operating at two distinct levels:

• with processors (i.e., manufacturers purchasing bio-compounds to produce shopping and ultra-lightweight bags) who were bound to purchase exclusively from Mater-Bi. This locked out competing bio‑compound suppliers; and
• with large-scale retail distribution (i.e., the main purchasers of such bags), who are bound to purchase from Novamont’s partner processors using Mater-Bi material. 

This dual-level system reinforced Novamont's position through a 'circular' dynamic: retailers insisted on Mater-Bi bags, and processors needed to align themselves fully with Novamont in order to secure the most profitable retail contracts. This effectively prevented alternative bio-compound suppliers from entering the market, limiting rivals' access to the majority of it, even though competing compounds met regulatory standards and sometimes offered lower prices.

Eni’s liability

The ICA found Eni jointly responsible once it fully acquired Novamont in October 2023. Under the principle of parental liability, a parent company exercising decisive influence is accountable for infringing conduct, even if it started before the takeover. After investigating the corporate structures, the Authority concluded that Eni was liable for Novamont’s market behavior from the moment it assumed control.

Fines and takeaways 

The ICA concluded by issuing fines totalling over €32 million. Of this, €30,359,000 was allocated to Novamont, while an additional €1,701,052.08 was allocated jointly to Novamont and Eni.

This decision shows that environmental mandates do not override fundamental competition principles, and demonstrates that the ICA is increasingly mindful of environmental and sustainability objectives in competition enforcement. 

The ICA decision (in Italian only) is available at the following link. 

The ICA press release (in English) is available at the following link.

For more information, please contact Federico Marini Balestra or Bianca Maria Gorlero.

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