Germany’s competition watchdog has found retail giant Edeka guilty of making “abusive demands” on suppliers after its 2009 takeover of rival chain Plus.
After a five-year investigation, the Bundeskartellamt issued a “preliminary asssessment” that said Edeka had “violated” Germany’s Anzapfevrbot law, which prohibits a retailer from inducing suppliers to grant it certain benefits “without any objective justification”.
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Andreas Mundt, president of the Bundeskartellamt, said: “After its takeover of the Plus stores in 2009, Edeka demanded so-called “wedding rebates” from dependent suppliers. We are currently assuming that this constituted an abusive practise insofar as Edeka demanded benefits from its suppliers without an objective justification.”
He added: “Tough negotiations between retailers and producers are normal in the food retail sector and, despite the strong market position of the few large retailers, generally not objectionable under competition law. According to our preliminary assessment, however, in the present case Edeka has crossed a line and abused its buyer power vis-à-vis its suppliers. In part, the demands were made with retroactive effect and without granting any corresponding compensation in return. A powerful company has to treat its economically dependent suppliers in a fairer manner.”
The watchdog investigated the rebates as part of its probe into Edeka’s acquisition of the Plus chain from German retailer Tengelmann in 2009.
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After its takeover of Plus, Edeka demanded special conditions from about 500 suppliers in different product areas, the anti-trust body said.
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By GlobalDataEdeka had demanded better purchase conditions granted to Plus also be offered to it as a whole, including longer payment periods that had been granted to Plus in some cases, it added.
Suppliers were asked to pay certain amounts of money for “synergy bonus”, “partnership compensation” or “bonus for product range expansion”, the Budeskartellamt said.
Edeka is not facing a fine and has been given the opportunity to comment until 20 September.
The retailer said: “We will now analyse the decision in detail and decide on further actions.”
