European Competition Law Scrutiny of Purchasing Alliances

It seems undeniable that within the EU interest is growing in purchasing alliances and particularly in the grocery retail sector. However, care must be taken to avoid drifting into a buyer cartel. The decisional practice of the EC and NCAs shows a clear distinction between buyer cartels and legitimate joint purchasing agreements. On the one hand, buyer cartels are viewed as restriction of competition by object and are per se prohibited. As a result, when such infringements are assessed, hefty fines are usually imposed. On the other hand, investigations into legitimate purchasing alliances, which are subject to an effects-based analysis, are rarely subject to fines, but rather, are often resolved by commitments. Only where joint purchasing agreements are used as a trojan horse for buyer cartels are they assessed more harshly.

By Liliane Gam¹

I. INTRODUCTION

Competition policy and enforcement action against collusion in Europe has largely focused on horizontal coordination among suppliers. However, in recent years there has also been a heightened interest in joint purchasing agreements or purchasing alliances by competition authorities, with increased competition enforcement, especially in the retail sector.

Unlike buyer cartels, which are regarded as having as their object the restriction of competition and are thus prohibited by competition law, joint purchasing agreements are usually unlikely to have as their object the restriction of competition since it is pr