On 7 April 2016, the Higher Regional Court of Celle held that
resale price maintenance in the framework of a promotion offered to
pharmacies for the sale of a dietary product did not constitute an
appreciable restriction of competition and therefore did not
infringe competition law.
In 2014, under the terms of a promotional offer, the defendant,
a manufacturer of the diet product A-Vitalkost, offered pharmacies
a 30% discount on a one-off direct order of 12 to 90 cans of the
product. This offer was conditional on the pharmacy displaying at
least three cans of the product on a shelf or display provided by
the defendant, and on the pharmacy respecting a minimum retail
price of € 15.95. The claimant, an association for the
prevention of unfair competition, sought an injunction against the
defendant for resale price maintenance.
The Court held that the setting of a minimum price for the
products in the promotional offer constituted a restriction of
competition under Article101TFEU and under the equivalent provision
of German competition law. It added that price fixing is a hardcore
restriction, which can generally be regarded as a restriction of
competition without the need to assess its actual effects on
competition. However, the Court ultimately concluded that the
specific offer in question did not amount to an infringement of
Article 101 TFEU or of the equivalent provision of German
competition law because the effect of the restriction on
competition was not appreciable. In reaching this conclusion, the
Court noted that (i) the promotional offer was limited in time and
applied only to a one-off sale of 12 to 90 cans of the product,
(ii) the pharmacies were free to choose whether or not to
participate in the promotional offer, and (iii) the market for
dietary products sold by pharmacies is very large and, therefore,
the economic impact of the restriction on pharmacies and consumers
was very small.
The Court stated that, in order to determine whether a
restriction of competition is appreciable, one must take into
account all relevant considerations, including quantitative factors
(for example, market shares), qualitative factors (for example, the
gravity of the restriction) and other relevant circumstances in the
market. The Court rejected the claimant's argument, which was
based on the Expedia ruling of the European Court of
Justice ("ECJ"), that appreciability can be presumed in
case of a restriction by object. Although the Court acknowledged
that a hardcore restriction under Article101TFEU is likely to be a
restriction of competition by object, it held that even a
restriction by object cannot always be presumed to constitute an
appreciable restriction that infringes Article 101 TFEU.
An appeal against this judgment of the Higher Regional Court of
Celle has been lodged to the German Federal Court of Justice. The
German Federal Court of Justice may thus need to rule on the
contentious issue of whether or not, in light of the
Expedia ruling of the ECJ, a restriction by object
(assuming the pricing restriction at issue is considered to qualify
as such) always amounts to an appreciable restriction of
competition under Article 101 TFEU.
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