Bundeskartellamt imposes fines for illegal price-fixing agreements
Germany“s Federal Cartel Office, the Bundeskartellamt, has imposed fines totaling 13.2 million euros on two packaging firms due to illegal price-fixing agreements. The companies had been supplying a commercial chain.
According to the Gesetz gegen Wettbewerbsbeschränkungen (GWB), the German Act Against Restraints of Competition, agreements between companies or „undertakings“ that restrict or prevent competition are prohibited. We at the commercial law firm GRP Rainer Rechtsanwälte note that this ban generally encompasses price-fixing arrangements.
On 3 May 2018, the Bundeskartellamt disclosed that it had imposed fines amounting to a total of 13.2 million euros on two packaging companies due to illegal pricing agreements. Both companies had been supplying a commercial chain with potatoes and onions. According to the Bundeskartellamt, the two companies had been fixing wholesale prices when calculating their weekly offers and in doing so effectively eliminated price competition between the two main suppliers to the chain.
From at least 2005 until the practice was first introduced in May of 2013, the two companies were said to have been regularly in contact by telephone prior to submitting their weekly offers. It was said that they informed each other of their respective wholesale prices for potatoes and onions as well as agreed to a uniform commodity price during these phone calls. The offer directed to the commercial chain was then calculated on the basis of this commodity price. The Bundeskartellamt went on to state that the same or almost the same values were fixed for other cost items as well.
It also noted that when setting the fines, account was taken of the fact that one company cooperated fully with the Bundeskartellamt. It is still possible for appeals to be lodged against the fine notices.
Violations of competition or antitrust law can give rise to severe penalties. These violations need not necessarily be blatant as in the case of illegal price-fixing arrangements. Even certain provisions in contractual clauses can be in violation of antitrust law and sanctioned accordingly. That is why it is advisable to have contracts checked by lawyers who are experienced in the fields of competition and antitrust law with a view to their implications from the perspective of these legal fields. Legal expertise is also necessary if violations of antitrust or competition law have already been committed and claims need to be fended off or enforced.
GRP Rainer LLP www.grprainer.com/en/ is an international firm of lawyers and tax advisors who are specialists in commercial law. The firm counsels commercial and industrial companies and corporations, as well as associations, small- and mid-sized businesses, self-employed freelancers and private individuals worldwide from offices Cologne, Berlin, Bonn, Dusseldorf, Frankfurt, Hamburg, Munich, Stuttgart and London UK.