Can antitrust laws affect competition?
Cartels and abuse of market power
What are cartels?
Cartels are understood to mean, in particular, agreements and coordinated behavior by companies that either have the purpose or the result of restricting or preventing competition. These primarily include price fixing, quota fixing and the division of markets between competitors.
Cartels hinder the economic freedom of companies and generally drive up prices for consumers. A study by the OECD found that prices are set around 16% higher than under normal competitive conditions. Cartels are therefore to a great extent economically and socially damaging.
What is abuse of market power?
If a company is not subject to sufficient competitive pressure, it can behave essentially independently of its competitors and ultimately also of its customers. Having such a dominant market position is not prohibited. The aim of antitrust law and the activities of the BWB is to stop abuses.
Behavior by dominant companies that disadvantage other companies or customers of companies and would not be possible if competition is effective is abusive. These include, for example, the enforcement of unreasonable prices, restriction of sales, discrimination against certain contractual partners or the sale of goods below the cost price.
§ 1. (1) All agreements between entrepreneurs, resolutions by employers' associations and coordinated behavior that aim to prevent, restrict or distort competition (cartels) are prohibited.
(2) According to Paragraph 1 are in particular prohibited
1. the direct or indirect fixing of purchase or sales prices or other terms and conditions;
2. the restriction or control of production, sales, technical development or investments;
3. the division of markets or sources of supply;
4. the application of different conditions for equivalent services to trading partners, which puts them at a competitive disadvantage;
5. the condition linked to the conclusion of contracts that the contracting parties accept additional services that are neither factually nor commercially related to the subject of the contract.
(3) The agreements and resolutions prohibited under Paragraph 1 are null and void.
(4) A cartel within the meaning of Paragraph 1 is equivalent to recommendations for compliance with certain prices, price limits, calculation guidelines, trading margins or discounts that aim or cause a restriction of competition (recommendation cartels). Exceptions are recommendations in which it is expressly pointed out that they are non-binding and that economic or social pressure should neither be exerted nor exerted to enforce them.
Prohibition of abuse
§ 5. (1) The abuse of a dominant market position is prohibited. In particular, this abuse can consist of:
1. the demand for purchase or sales prices or other terms and conditions that deviate from those that would be highly likely to result from effective competition, taking into account in particular the behavior of entrepreneurs in comparable markets with effective competition,
2. the restriction of production, sales or technical development to the detriment of consumers,
3. the disadvantage of contractual partners in competition through the application of different conditions for equivalent services,
4. the condition linked to the conclusion of the contract that the contracting parties accept additional services that are neither factually nor commercially related to the subject of the contract,
5. the objectively unjustified sale of goods below the cost price.
(2) In the case of para. 1 no. 5, the dominant entrepreneur bears the burden of proof to refute the appearance of a sale below the cost price as well as for the objective justification of such a sale.
Art 101 and Art 102 UAEU contain similar prohibitions and concern behavior that can affect trade between the member states or affect a substantial part of the common market.
Make a complaint!
If you are aware of violations of the prohibition of cartels or market power abuse, please file a complaint.
To do this, use the complaint form, which you can send to us by post, or email or fax.
Register as a key witness!
Is your company involved in cartel agreements and would you like to end them? Then become a key witness!
Find out exactly: Leniency Notice
The action of the BWB against hard-core cartels
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