The Autorité de la concurrence has imposed (19 December) fines totaling €611 million on 10 manufacturers and two distributors of household appliances for engaging in vertical price-fixing agreements. These agreements, which spanned from 2007 to 2014, sought to keep retail prices artificially high, particularly in response to growing competition from online distributors.
Companies Involved
The fined entities include major manufacturers such as BSH, LG, Whirlpool, Electrolux, and SEB, as well as prominent distributors Darty and Boulanger. The practices targeted both small and large household appliances, undermining competition and restricting consumer access to lower prices.
Anti-Competitive Practices
The Autorité found that the manufacturers and distributors colluded to enforce retail pricing across their networks. Manufacturers provided pricing instructions to distributors and monitored compliance using tools and direct communications. Distributors that failed to comply faced retaliatory measures, such as delivery delays or blocked product access.
At the same time, traditional distributors like Darty and Boulanger actively participated in these schemes to protect their profit margins. They pressured manufacturers to act against non-compliant online sellers and sought compensation to maintain competitive pricing without sacrificing margins.
Impact on Consumers and the Market
These practices had far-reaching consequences:
- Consumers: Artificially inflated prices prevented consumers from benefiting fully from competitive pricing, especially as online sales of household appliances grew.
- Distributors: Online-only retailers faced significant challenges, with many forced out of the market. By 2014, approximately 95% of online distributors had either closed or been acquired by traditional players.
Penalties and Settlements
The fines were distributed across the 12 companies, with the largest penalties levied on SEB (€189.5 million), Darty (€109 million), and Boulanger (€84.35 million). Most companies opted for the settlement procedure, accepting the Autorité’s findings in exchange for reduced penalties. However, SEB and Boulanger contested the charges, which were ultimately upheld.
In addition to the fines, the Autorité ordered the publication of the decision’s summary in the print and online editions of Le Monde and Les Echos.
A Broader Effort to Combat Collusion
This decision follows a related 2018 ruling where fines of €189 million were imposed for horizontal agreements between several manufacturers. The Autorité emphasized the seriousness of the vertical agreements, noting that they were covertly implemented and institutionalized, using coded language to obscure their intent.
The case highlights the Autorité’s commitment to fostering fair competition in markets increasingly influenced by digital platforms. This landmark ruling serves as a warning against practices that harm consumers and stifle innovation.
