AdC sanctions three supermarket chains and alcoholic beverage supplier for price fixing
Press Release 19/2022
September 14, 2022
The AdC (Portuguese Competition Authority) has sanctioned three supermarket chains - Auchan, Modelo Continente and Pingo Doce - as well as their common supplier of alcoholic beverages Active Brands/Gestvinus, and a manager of this company, for having participated in a scheme of price fixing on retail prices.
The AdC’s concluded that the participating distribution companies ensured the alignment of retail prices in their supermarkets through contacts established through the common supplier, without the need to communicate directly with each other.
Such behavior eliminates competition, depriving consumers of the option of better prices, ensuring better levels of profitability for the entire distribution chain, including the supplier and the supermarket groups.
For more information on the case, please see the AdC’s website.
In November 2020, the AdC issued the Statement of Objections for the current case, providing all companies the opportunity to exercise their right to be heard and to defend themselves. Such defenses were duly considered in the final decision.
The AdC’s investigation in the current case allows to determine that the behavior lasted for more than eight years - between 2009 and 2017 - and targeted several products such as wines, brandies, and liquors/appetizers.
The large retail cases decided between 2020 and 2022 covered sanctions to six supermarket chains and nine suppliers for the anticompetitive practice of hub-and-spoke.
For the present infringement, a total fine of €5.665.178 was imposed.
The total fine is detailed as follows:
The fines imposed by the AdC are determined by the sales turnover of the sanctioned company in the affected markets in the years of the sanctioned behavior. In addition, according to Portuguese Competition Law, fines cannot exceed 10% of the company’s turnover in the year prior to the sanctioning decision (and 10% of the annual remuneration earned in the last year of the infringement, in the case of individuals).
In setting the fine, the AdC takes into account the seriousness and duration of the infringement, the degree of participation of the companies in the infringement, the economic situation of the companies, among other circumstances (see the AdC’s Guidelines on the Methodology to be Used in the Application of Fines [in Portuguese]).
The sanctioning decisions may be appealed. The appeal does not suspend the execution of fines. Undertakings may request the Competition, Regulation and Supervision Court to suspend the enforcement of the decisions if (i) they demonstrate that it causes them considerable prejudice and (ii) they provide an effective guarantee in its place.
For further information see “Q&A about “hub-and-spoke” cases in Large Distribution sector".
Watch the hub-and-spoke video on the multimedia page of the AdC website.