The Corona virus also leads to exceptional circumstances for companies in the field of antitrust law. The European competition authorities have recognised this and issued a joint statement on 23 March 2020 on possible relaxations but also with warnings (link to download the statement on the BKartA website). The authorities, however, are promising easing, but also explicitly warn against exploiting the special situation for inflated health prices.
We summarize the antitrust significance of the Corona crisis below:
Relaxation of antitrust law
According to the joint statement, the authorities are aware of the social and economic consequences of the Corona virus. In order to ensure the distribution of scarce products, cooperation between competitors is likely to be possible. If there are concerns, companies willing to act could contact the competition authorities. In Germany, the Federal Minister of Economics has already publicly suggested that antitrust law should be relaxed, at least for retail chains, and that cooperation between the food industry and retailers should be allowed because of the border closures. The situation in the United Kingdom is wider, where food retailers are already allowed to exchange information on stocks and work together on transport and storage capacities and personnel to ensure deliveries.
Relationship with competitors
The Corona-crisis itself does not give an ’emergency right’ for antitrust violations. Coordinated action with competitors remain critical from an antitrust point of view. For example, discussions and agreements between competitors to deal with the crisis are regarded as restrictive of competition, e.g. by raising prices for increased costs or concerted rejections of supplier/customer claims. This also applies, of course, when competitors meet in associations. There is a great danger here that the common need will result in a prohibited agreement. Companies should therefore, as before Corona, verify the use of contact with competitors for their admissibility under antitrust law. Discussions, for example, on possible protection and hygiene measures in companies may be permitted. We are happy to assist you in clarifying doubts.
Influence on dealers’ prices
The authorities make it also clear in the joint statement that manufacturers with price caps may force their dealers not to exploit the situation for ‘unjustified price increases’. With regard to pricelimits, the prohibition on cartels continues to apply. Suppliers can still issue non-binding price recommendations. However, these must not have an impact, e.g. by incentives or threatened disadvantages such as fixed prices.
In the joint statement, the authorities explicitly warn against exploiting the situation for inflated prices, in the health sector in the field of health. The lack of important supply products and supply chain problems is already leading companies to significantly increase prices for some products due to the huge demand. For example, disinfectant products are often charged many times the average price. Such practices are closely monitored by the antitrust authorities. In Germany, above all, dominant companies are subject to special conduct obligations, but every other company is also subject to the limits of usury, which is a criminal offense in Germany.
If Corona leads to the scarcity of certain products in the case of dominant companies, these companies must supply their customers without discrimination.
Merger control requires companies to expect longer waiting times. Several competition authorities have already announced delays. For this reason, for example, both the Federal Cartel Office and the European Commission are asking companies and their representatives to reconsider whether a procedure must be submitted and to postpone notifications as far as possible Link to the communication from the Federal Cartel Office / Link to the communication of the EU Commission.
- If your products or services are systemically relevant, there is the possibility of easing antitrust restrictions in case of difficulties.
- However, under these circumstances the control of the competition authorities is also more intensive.
- In this crisis situation, price increases must be examined very closely and the drivers for this should be documented.
We are happy to assist you in clarifying doubts. Above all, the actlegal team wishes you and your families to come through this extraordinary time healthy.