Another Fine for Anticompetitive Behaviour in the Pet Food Sector – EUROBEN To Pay CZK 1 Million

2023-09-22
By its final decision, the Office for the Protection of Competition (hereinafter referred to as "the Office") imposed a fine of CZK 1,066,000 on EUROBEN, s.r.o., a company operating in the pet food distribution sector, for entering into anticompetitive agreements on resale price maintenance.

Based on the Office's findings, in the period from 1 January 2016 to 15 September 2021, EUROBEN set minimum retail prices for its wholesale customers for sales to final consumers, monitored compliance with these prices and urged these customers to increase their prices to the level it set. EUROBEN threatened and actually imposed sanctions on retailers who breached this price policy.

The Office qualified this anticompetitive conduct as prohibited vertical agreement on direct resale price fixing, resulting in distortion of competition in the pet food markets of the Czech Republic.

When calculating the fine, the Office recognized the above-standard cooperation of the party to the proceedings, which voluntarily stopped the anticompetitive behaviour immediately after the on-site inspection. EUROBEN itself also informed its customers about their freedom in setting sales prices and provided the Office with significant evidence of its competition law infringement. Furthermore, the Office reduced the fine considering the implementation of a competition compliance programme and fulfilment of the settlement conditions. Although vertical agreements constitute serious infringement of the competition rules, the Office reduces the fines for the aforementioned actions taken by the party to the proceedings as they considerably reduce the time and cost of the administrative proceedings.

This is the third case of the imposition of fines for vertical price agreements in the pet food sector. Minimum price fixing by suppliers restricts price competition between retailers and increases the price level of goods for consumers. Sellers must not be restricted in any way in their freedom to set the selling price of goods for retail sale, a supplier may only indicate a recommended price but must not enforce compliance with it.

Press Unit of the Office for the Protection of Competition
23/0129 – S0105/2022

 

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