Update on the Belgian Competition Authority decisional practice

By Hein Hobbelen, Baptist Vleeshouwers

06-2021

On 28 May 2019, the Belgian Competition Authority (“BCA”) had fined the Belgian Order of Pharmacists (“BOP”) for hampering the development of MediCare Market, a chain of pharmacies and para-pharmacies, in Belgium. The fine originally imposed amounted to EUR 1 million. The BCA identified a series of actions that, while individually not anticompetitive, when put together aimed at excluding MediCare Market. The BOP’s actions included filing cases before disciplinary councils, filing for interim injunctions and cease and desist orders, and disseminating misleading information to the public.

The BOP appealed the decision and the Brussels Markets Court confirmed on 8 January 2021 that the BOP’s behaviour indeed constituted an infringement of the prohibition on anti-competitive behaviour. However, it held that the BCA had calculated the fine incorrectly. In particular, the Court held that the BCA had incorrectly calculated the fine maximum.

On 26 March 2021, the BCA adopted a new decision imposing a fine of EUR 245,000 on the Order, based on the interpretation of the Court.

In the meantime, the rules have however been amended. The maximum fine for a trade association which has breached competition law is now equal to 10% of the aggregate turnover of all members of the association which are active on the relevant market. Before, only the 10% cap was calculated based on the association’s own turnover. Fines imposed on trade associations are therefore potentially higher in the future.

End of investigation concerning the Carrefour/Provera alliance

On 6 May 2021, the BCA closed its investigation into the purchasing alliance between Carrefour and Provera (the central purchasing unit of the Louis Delhaize Group). Following dawn raids at both parties, the BCA had concluded that the operations of the alliance and the exchanges of information between Carrefour and Provera could constitute infringements of competition law.

To address these concerns, Carrefour committed to transfer its entire purchasing department to a separated legal entity. Both parties also presented a stricter framework for the exchange of information essential to the proper functioning of the alliance. In addition, parties committed to limit the alliance to financial aspects of joint purchases, to ensure that each party would be able to develop its commercial strategy fully independently.

Following a market investigation, the BCA decided to close the investigation.

Members of Caudalie Group fined for RPM and restrictions on active and passive sales

On 7 May 2021, the BCA fined several companies of the Caudalie Group for imposing minimum resale prices and limitations to active and passive sales to members of their distribution network. The restrictions were imposed in the context of selective distribution and online sales of cosmetics. The fine amounts to almost EUR 860 thousand.

We note that the BCA took into account the Coty jurisprudence of the EU Courts. In particular, the BCA accepted the Group’s commitments regarding the conditions that Caudalie may impose on distributors in order to protect the integrity of its distribution network and preserve its brand image. Interestingly, the BCA also accepted these commitments as an attenuating circumstance for the calculation of the fine.

For more information please contact Hein Hobbelen and Baptist Vleeshouwers.

 
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