In summary proceedings on 8 September 2022, the Hamburg Regional Court decided that Coca-Cola must continue to supply Edeka, and that a supply stop would constitute abuse of a dominant position.(1) The decision was preceded by a dispute between the parties concerning price increases by Coca-Cola.
In January 2022, both parties had agreed on purchase prices. In September 2022, Coca-Cola demanded higher purchase prices from Edeka due to increased costs for products, services and energy. After Edeka refused to pay them, Coca-Cola stopped supplying goods. Edeka then applied for an interim injunction.
The Hamburg Regional Court granted Edeka's interim injunction application. Coca-Cola must therefore continue to supply the supermarket chain at the agreed purchase prices. However, this obligation is limited until the end of September 2022. Coca-Cola Europacific Partners, the bottler of the popular drink, has filed an objection against the interim injunction on the grounds that it had not been heard before the regional court's decision. In particular, it argued that the price adjustment was announced and explained early. Moreover, the higher prices were also reasonable because they were still below the price development of many other trademarks.
Dominant companies like Coca-Cola are bound to stricter rules under competition law, as it is easier for them to influence and possibly even eliminate competition. Since this can have negative effects on the market as a whole and on consumers individually, the German Act against Restraints of Competition prohibits certain abusive practices by these companies in sections 19 to 20. According to Edeka's assessment – now provisionally confirmed by the Hamburg Regional Court – Coca-Cola's increased price demands constituted such a prohibited conduct. The Court considered the new price demands to be unreasonable and, consequently, the enforcement of these unreasonable prices by Coca-Cola by means of a supply stop constituted an abuse of a dominant position.
According to calculations by the German Federal Statistical Office, prices for food in supermarkets have risen by 16.6 % since the beginning of 2022, as costs have increased at all levels of the value chain (ie, production, wholesale and retail). Companies are increasingly trying to pass on these rising costs to trading partners and consumers.
However, this does not work without resistance, therefore disagreements and conflicts should be expected in the future as well. So far, it can be observed that producer and wholesale prices have increased significantly more than retail prices, as retailers are concerned about losing too many customers due to too large price increases. In some cases, such conflicts have already escalated – for example, between Edeka and its subsidiary Netto versus the Mars group and the producer Mondelez.
Since it is to be expected that prices at all levels of the market will continue to rise due to inflation and geopolitical circumstances, it is very likely that the number of such conflicts will continue to grow and therefore increasingly occupy the courts.
For further information on this topic please contact Solvei Hartmannsberger at Fieldfisher by telephone (+49 211 950 749 0) or email ([email protected]). The Fieldfisher website can be accessed at www.fieldfisher.com.
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