Forewarned is forearmed: RPM still top of mind
The clock is ticking for companies to set the record straight on resale price maintenance (RPM). Retailers must be able to determine their own retail prices without any direct or indirect meddling by suppliers.
The Dutch Authority for Consumer and Markets (ACM) recently warned various suppliers to refrain from illegally influencing their retailers’ resale prices. Those suppliers have tweaked their compliance programmes, revised their distribution agreements and launched internal investigations to abide by the ACM’s warning.
Forewarned is forearmed: this is the ACM’s second warning following its first-ever vertical price coordination fine. Other companies may want to follow the warned suppliers’ example, check their distribution agreements and update their compliance programmes. It would appear to be only a matter of time before the ACM hands out (more) fines rather than warnings.
The heat is on?
The ACM joined the European Commission’s battle against online and offline vertical restraints in late 2018 (see also our January 2023 newsletter).
So far, this has led to a fine of nearly EUR 40 million being imposed on Samsung Electronics for unduly influencing the online resale prices for televisions at seven retailers (see our October 2021 newsletter; appeal pending). In addition, when closing its vertical restraints investigation into the home-decor sector, the ACM warned suppliers not to pressure retailers into following their retail price recommendations or to inform retailers of the resale prices of other retailers.
The ACM’s campaign to raise awareness among retailers that they are free to set their own price and to report any undue influence over their retail prices appears to have paid off. After a warning to suppliers active in animal feed, hobby supplies, toys and special shoes, the ACM’s latest warning was directed at suppliers of smart sports devices, food supplements and portable television receivers, and led these suppliers to take measures to avoid vertical price influencing.
Conclusion
The ACM is sending a clear message that RPM and vertical price influencing are still high on its priority list. The upcoming ruling in Samsung’s appeal may provide more clarity on the boundaries between illegal RPM and legitimate recommended resale prices.
For now, companies can use the European Commission’s Vertical Block Exemption Regulation and the accompanying Guidelines, as well as the ACM’s checklist for recommended retail prices and Guidelines, to steer away from vertical no-nos.
This article was published in the Competition Newsletter of April 2023. Other articles in this newsletter:
