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Asics' Online Sales Restrictions Confirmed as Illegal by Duesseldorf Higher Regional Court

On 5 April 2017, the Duesseldorf Higher Regional Court confirmed the August 2015 decision of the Federal Cartel Office finding that it is anti-competitive and therefore illegal to impose on distributors a general prohibition on the use of online price comparison portals.

The Cartel Office had faulted Asics over imposing the following restrictions on its distributors: (1) a complete ban on the use of online marketplaces such as eBay or Amazon; (2) restricting supporting price comparison engines; (3) prohibiting the use of the Asics brand names on third party websites; and (4) the very detailed segmentation of distributors into more than 20 categories, and resulting restrictions on cross-deliveries to other authorised distributors in other categories and on the product ranges for supply to final customers.

Of these findings, the Duesseldorf Court only considered the finding that restricting support of price comparison engines is anticompetitive. The Court found that generally prohibiting the use of price comparison engines is a restriction of competition, as the European Court of Justice ruled, notably, in C-439/09 Pierre Fabre Dermo-Cosmétique SAS. Such a prohibition deprives distributors of an opportunity to advertise and sell online effectively. Moreover, the Court found that the prohibition was not justified by either branding considerations or the need for staff to provide customer counselling services. Consumers (1) would not necessarily need advice before purchasing running shoes, and (2) may prefer to look up such information on the Internet. On this basis, the Court concluded that the prohibition was a hard core restriction of competition, which could not be exempted.

Andreas Mundt, President of the Federal Cartel Office, welcomed the judgment, and, in doing so, provided further colour regarding the Cartel Office’s broader view of such restrictions:

Online price comparison portals are an important means for consumers to get transparent information about prices and to be able to compare these. They are particularly important for small and medium-sized traders so that they can be found. Therefore, it is important to us that manufacturers do not generally prevent their dealers from using price comparison portals. That was our aim with the pilot case.”

The upcoming judgment in the Coty referral to the European Court of Justice will likely provide further colour on the circumstances in which branding considerations might justify some form of restriction on the use of online marketplaces.

© 2017 Covington & Burling LLP

TRENDING LEGAL ANALYSIS


Nicoleta Tuominen, Covington Burling Law Firm, EU competition attorney
Associate

Nicoleta Tuominen is an associate in the Competition group of the Brussels office.  Her practice focuses on all areas of EU Competition law, including merger control, abuse of dominance, cartel investigations, article 101 and 102 investigations, and state aid cases, as well as regulatory issues. Her practice further covers anti-corruption compliance and European and international trade law. Ms. Tuominen advises clients in a variety of sectors, including pharmaceuticals, media and technology, energy and natural resources.

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