Germany’s Federal Cartel Office finds ASICS’ restrictions of online sales illegal

By Gabriele Accardo

On 27 August 2015, the Federal Cartel Office (“FCO”) concluded its proceedings concerning certain anticompetitive restrictions in the distribution system of ASICS Deutschland (“ASICS“), and found that ASICS breached the EU competition rules on anticompetitive agreements, insofar as it restricted online sales of its small and medium-sized authorized dealers (see Newsletter 2/2014, p. 20 for more background).

The FCO took issue with ASICS’ prohibiting its dealers from using price comparison engines for their online presence and from using ASICS brand names on the websites of third parties to guide customers to their own online shops.

While ASICS had already amended the clauses concerned, Andreas Mundt, President of the FCO, noted that if manufacturers prohibit their authorized dealers from using price comparison engines and online sales platforms or from using the manufacturers’ brand names in their own search engine advertisements, it will de facto no longer be possible for consumers to find the smaller retailers, in particular, on the Internet. This in turn would allow manufacturers, such as ASICS, to control price competition in both online and offline channels.

The FCO also noted that while small and medium-sized distributors could not compensate for the sales lost due to the limited reach of their “shops” resulting from ASICS’ prohibition, the online business will ultimately be concentrated in the hands of the manufacturers themselves and a few large retailers or leading marketplaces.

The FCO has not specifically ruled on the outright prohibition to use online marketplaces such as eBay or Amazon, due to the fact that the other online restrictions were found anti-competitive.

Interestingly, the FCO noted competition authorities have received numerous complaints from distributors about the conditions for online sales set by brand manufacturers, and that the European Commission’s current sector inquiry into e-commerce will also possibly provide further insights on this issue. Not surprisingly, the FCO stated that further decisions by the authorities or the courts can be expected in this area.