Editor's Note
This editor’s note highlights the key facts and market implications behind “Swiss Competition Commission Fines Sanitary Whol”, with emphasis on sourcing, product fit, fabrication, logistics, or buyer impact.
The Swiss Competition Commission (Weko) has imposed a total fine of approximately 80 million Swiss francs on sanitary wholesalers. Industry representatives are contesting the allegations of price and quantity collusion.
The Weko is continuing its crackdown. On Friday, it fined sanitary wholesalers around 80 million francs for price and quantity collusion. Weko Director Rafael Corazza stated this is one of the more complex cases with significant impact. The Swiss Sanitary Wholesalers Association and eight companies are being fined.
Association as a Platform
The association allegedly served as a platform for reaching the collusive agreements. Approximately 70% of the fines, which are turnover-dependent, fall on the market leader Sanitas Troesch, which participated in parts of the cartel, and the Irish Cement Roadstone Holding (CRH). Together, they hold a market share of over 50%.
The Weko accuses the companies of coordinating on price components and price-determining factors such as margins, gross prices, or discounts from 1997 to 2011. Furthermore, companies that did not sell their products through wholesalers were allegedly hindered from entering the market. According to the Weko, consumers and, in part, sanitary installers were harmed by the collusion.
In the sanitary sector, about four-fifths of products are sold through wholesalers. Among those fined are the market's number three and four, Sabag and Bringhen, as well as the smaller suppliers Kappeler, SAB Sanitär Burgener, Sanidusch, and Innosan.
The association, Sanitas Troesch, and the Sabag group firmly deny the allegations. The association points out that in 2006, the Weko explicitly found no violations of cartel law. Based on tips from the public, the now-concluded proceedings were opened in 2011. Corazza said that because the Weko can now conduct house searches, it has obtained more incriminating material. The previous proceedings primarily concerned common gross prices.
Legal Steps
The Weko intends to publish the detailed reasoning for its decision only in about four months. After that, the affected companies can file appeals. Sabag CEO Martin Scholl intends to file a complaint with the Federal Administrative Court. He argues the threatened fine of over 8 million francs is disproportionate to the profitability of the affected division and would threaten its existence. Scholl expects the Weko decision to be overturned. However, a corresponding court ruling is not expected for at least three to four years.
Source: Read the original article | Published: July 03, 2015