Summary
PACCAR Inc filed an 8-K report on July 19, 2016, to provide an update on a European Commission (EC) investigation into competition rules. Previously, in Q1 2016, the company had recorded a charge of €850 million ($942.6 million) related to this investigation. The EC has now concluded its investigation with a settlement with DAF, PACCAR's subsidiary, imposing a fine of €752.7 million ($833.0 million). As a result of this settlement, PACCAR will reverse €97.3 million ($109.6 million) of the previously recorded charge in the second quarter of 2016. DAF will pay the fine within three months, and it is not tax-deductible. The company confirmed that DAF has sufficient liquidity to cover the fine.
Key Highlights
- 1European Commission (EC) concludes investigation into competition rules involving DAF Trucks N.V.
- 2EC imposes a fine of €752.7 million ($833.0 million) on DAF.
- 3PACCAR to reverse €97.3 million ($109.6 million) of the previously recorded €850 million charge in Q2 2016.
- 4DAF will pay the fine within three months of notification from the EC.
- 5The fine is not tax-deductible.
- 6DAF has adequate liquidity to fund the fine payment.