Bundesgerichtshof changes approach to defining geographic market

20 January 2005

Georg Terhorst

The German Federal Supreme Court (Bundesgerichtshof) ruled that the relevant geographic market under German cartel law is no longer limited to the territory of the Federal Republic of Germany (KVR 14/03).

In a decision dated 5 October 2004 the Bundesgerichtshof annulled a decision by the Higher Regional Court of Düsseldorf, which had cleared a joint venture in the area of vacuum cleaner bags.

In its previous case law, the Bundesgerichtshof ruled that, for legal reasons, the relevant geographic market under German antitrust law could not extend beyond German borders. The Bundesgerichtshof has now decided that market definitions generally have to be based on economic criteria. Thus, the relevant geographic market under German law may also include other European countries. Owing to the network of national competition authorities, sufficient information is ensured through the inter-authority exchange mechanism concerning market situations outside Germany.

Source: Press release No. 109/2004 of the Bundesgerichtshof, 5 October 2004 available at: http://www.bundesgerichtshof.de.