Retail

The French Competition Authority (“FCA”) prohibited the proposed acquisition of the hypermarket retailer Géant Casino by its competitor E.Leclerc in the French city of Troyes.  It found that the transaction would create a duopoly between the two remaining hypermarkets, Carrefour and E.Leclerc, risk increasing prices, and reduce the diversity of the offer for consumers.  It is the first time the FCA has issued a merger prohibition.
Continue Reading The French Competition Authority’s first merger prohibition

Last month in In the Matter of 1-800 Contacts, Inc., the Federal Trade Commission (“FTC”) provided insight into the circumstances under which retail price competition may take place in the 21st century internet economy. In the Opinion authored by Chairman Joseph J. Simons (“Commission’s Opinion”) the Commission decided that 1-800 Contacts, the country’s largest online retailer of contact lenses, unlawfully entered into anticompetitive agreements with 14 rival online sellers (“Agreements”). The Agreements, which, in most cases were trademark litigation settlements, required the parties, when bidding as part of search engine advertising auctions, to take measures ensuring their advertisements do not appear in response to searches for the other party’s trademark terms. According to the Commission’s Opinion, approved 3-1-1, the “decision will affect not only the price that consumers pay for some contact lenses but also the very manner in which substantial parts of price competition will occur throughout consumer markets today and tomorrow.” This week, 1-800 Contacts filed an application with the FTC for a partial stay pending review by the U.S. Court of Appeals.
Continue Reading Sights on Online Search Advertising: FTC Finds Practices by 1-800 Contacts to Unlawfully Harm Competition and Restrict the Availability of Truthful Advertising to Consumers

The European Commission (“Commission”) recently fined Denon & Marantz, Asus, Pioneer and Philips (the “Individual Parties”) a total of EUR 111 million for restricting the ability of online retailers to set retail prices for their products – a hard-core restriction under EU competition law known as “resale price maintenance” or “RPM” (the “Infringement Decisions”). These Infringement Decisions are noteworthy because: (i) they are the first e-commerce infringement decisions since the Commission’s 2017 Final Report on its e-commerce sector inquiry; and (ii) the last ‘traditional’ RPM fine imposed by the Commission was fifteen years ago in Po/Yamaha COMP/37.975 (16 July 2003).
Continue Reading The European Commission Publishes Summary Decisions for On-line Resale Price Maintenance Infringements

The UK Government’s Department for Business, Energy and Industrial Strategy has just released a 75-page Green Paper on Modernising Consumer Markets, setting out the Government’s main priorities for the digital economy in a post-Brexit Britain. The Green Paper reflects on the current state of consumer markets and regulation, and lays down the key challenges and opportunities which will be the focus of the UK’s regulatory and competitive framework going forward. This poses consultation questions to stakeholders on hot topics in digital markets, including questions on: the adequacy of the current competition rules and privacy protections, supporting consumer-friendly innovation, use of and access to big data, whether personalised pricing should be regulated, sufficiently protecting customers without stifling innovation, and alternative dispute resolution solutions.

It also includes various proposals to ensure new technology and data are used to benefit customers, strengthen national enforcement of consumer rights, modernise the approach taken by regulators, and improve consumers’ access to alternative dispute resolution services. In this Covington blog post, we explore some of the key messages and questions posed by the Green Paper.Continue Reading The UK Government Seeks Views on the Regulation of Digital Markets for a Post-Brexit Great Britain

In its decision of 12 December 2017, the German Federal Supreme Court (Bundesgerichtshof – BGH) dismissed ASICS’ application to appeal the 2017 judgment of the Düsseldorf Higher Regional Court (OLG) on alleged online sales restrictions.  The BGH confirmed that prohibiting the use of price comparison websites by retailers constitutes a hardcore restriction under EU competition law.

In 2015, the Federal Cartel Office (Bundeskartellamt – BKartA) found that ASICS’ selective ‘retail system 1.0’ (the system was launched as “Vertriebssystem 1.0”) contained hardcore restrictions  under Article 4(c) of the Vertical Block Exemption Regulation (VBER).  By introducing retail system 1.0, ASICS had allegedly requested approximately 2,000 retailers to refrain from advertising ASICS’ products via price comparison websites and prohibited the use of its brand names on third party websites redirecting customers to retailers’ online shops.Continue Reading German Bundeskartellamt’s Decision against Online Sales Restrictions by ASICS Ultimately Confirmed

Germany’s Federal Supreme Court (Bundesgerichtshof – BGH) has now published its full judgment in EDEKA – wedding rebates (case KVR 3/17) on allegedly anti-competitive requests for preferential rebates and conditions by food retailers.

For background on the preceding decisions of the Federal Cartel Office (Bundeskartellamt – BKartA) and Higher Regional Court of Düsseldorf (OLG Düsseldorf) please see our previous post.

The BGH’s judgment clarifies a number of issues regarding the application of Germany’s rules on abuse of relative market power.

The concept of relative market power does not exist at EU level which covers only abuse of market power by dominant undertakings.  In Germany, relative market power exists in vertical relationships (i.e. supplier/customer relationship) if one undertaking is “dependent” upon the other.  An undertaking is dependent if it has no possible and practicable alternatives available to switch business partners.Continue Reading Update: EDEKA “Wedding Rebates” – German Federal Supreme Court Answers Key Questions on Abuse of Relative Market Power

On 23 January 2018, Germany’s Federal Supreme Court (Bundesgerichtshof – BGH) handed down its judgment on alleged anti-competitive requests for preferential rebates and conditions by food retailers (case KVR 3/17 – not yet published).  This is an important judgment as it removes a major roadblock to antitrust enforcement in the food retail sector in Germany, and maps a route for antitrust enforcement in a sector in which regulators have historically struggled to make much headway.
Continue Reading EDEKA “wedding rebates” – German Federal Supreme Court removes roadblock to antitrust enforcement in food retail sector

On 6 December 2017, the Court of Justice of European Union (CJEU) issued its long-awaited Judgment in Coty Germany GmbH v Parfümerie Akzente GmbH.  Taking an approach similar to that adopted by Advocate General (AG) Wahl in his Opinion in July, the CJEU found that a supplier of luxury goods may prevent its authorised…
Continue Reading Luxury Goods Manufacturers May Block Certain Online Sales on Third-Party Platforms

On 30 November, Covington and Laurence Simons co-hosted a seminar on e-commerce in the EU for a variety of General Counsel from different industries.  E-commerce continues to grow rapidly in Europe and is expected to be worth more than €600 billion in 2017.  In this context, companies already active in the EU, or wishing to enter the European market, must familiarise themselves with the potential legal challenges ahead of them.
Continue Reading E-Commerce in the EU, Covington & Laurence Simons General Counsel Seminar

On 22 November, Johan Ysewyn and Maria Jaspers (DG COMP) presented the highlights of recent EU cartel enforcement in their annual dual-presentation at the Advanced EU Competition Law Conference in Brussels.  They covered their traditional three pillars of enforcement, policy and court review.
Continue Reading Key Conclusions – Cartels: Lessons from Recent Investigations, Brussels Advanced Competition Law Conference