The Dutch competition authority (ACM) has fined technology giant Samsung €39 million for influencing prices in the online sale of televisions. According to the ACM, Samsung exercised undue influence from January 2013 to December 2018 by giving price recommendations to retailers. Here, we summarise the key points from the case.
Resale price maintenance (RPM) is obligation imposed by a supplier of goods or services on its resellers to maintain a fixed sales price or a minimum sales price. RPM is prohibited under Article 101 (1) TFEU and Article 6 (1) of the Dutch Competition Act.
Until now, the ACM has only taken very limited enforcement action against RPM and vertical agreements, although it had previously promised to more actively pursue antitrust violations arising out of RPM.
The ACM's decision to finally deliver on this promise with the Samsung case was possibly inspired by similar RPM-related enforcement action taken by the European Commission against organisations in the consumer electronics sector.
What happened in the Samsung case?
Samsung used automated web crawlers to monitor retailers' online sales prices. When Samsung noticed prices that were lower than it would like, it contacted the relevant retailers and "urged" them to adjust their prices. Retailers asserted that they felt pressure to raise their minimum prices of Samsung products because all competing retailers were doing the same. According to the ACM, this ultimately meant that consumers paid too much for Samsung's products.
The ACM also contended that Samsung tried to cover up the practice. Samsung employees who urged retailers to raise prices used the term "advice"; advising retailers to adopt a retail price is not a violation of competition law, but only if the advice is "individual" and "non-obligatory". Following the ACM's investigation, however, WhatsApp and email messages emerged that showed that Samsung had informed retailers that the "advice" they received was also given to other retailers. As a result, the ACM held that the "advice" Samsung provided retailers was not "individual".
It also transpired that some retailers had asked Samsung to call to other retailers who did not adjust their prices in-line with Samsung's advice. The retailers therefore knew that adopting the higher prices requested by Samsung would not lead to a market position where they had to fear losing customers. As such, Samsung's "advice" did not qualify as non-obligatory, either.