On 14 January 2010, the German Federal Cartel Office (“FCO”) conducted dawn raids on the premises of 11 retailers and 4 manufacturers of branded goods. The nation-wide on site investigations involved a total of 56 FCO officials which were assisted by 62 policemen. The dawn raided companies include grocery stores, drug stores, domestic-animal supplies traders and manufacturers of branded products. Further proceedings against other traders were initiated in writing.

The FCO conducted the dawn raids on suspicion of co-ordinated retail price-fixing for confectionery, coffee and pet food. According to Article 101(1) of the TFEU and the Vertical Block Exemption Regulation, a supplier may not impose on its distributor fixed or minimum prices (or price levels), referred to as Resale Price Maintenance (“RPM”). RPM constitutes a prohibited hard core restriction, rendering agreements null and void. Suppliers may however give non-binding price recommendations and set maximum prices (or price levels), respectively.

The dawn raids were conducted shortly after the FCO had imposed fines totalling approximately €159.5 million on Tchibo GmbH, Melitta Kaffee GmbH, and Alois Dallmayr Kaffee OHG on 18 December 2009. The three coffee producers had formed a price cartel and had fixed coffee prices since 2000. It cannot be excluded that the January dawn raids may have been based on information obtained during this investigation.

The latest dawn raids show that the FCO will continue its hard line approach against companies engaging in RPM practices. In 2009 the FCO had imposed significant fines on Microsoft, the contact lenses producer CIBA Vision and Phonak GmbH, a manufacturer of hearing aids, for RPM and restricting internet sales.

14 January 2010