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AFCA highlights that ban on price cartels also applies to smaller markets and discontinues its investigations into kebab, burger and pizza takeaways

The Austrian Federal Competition Authority (AFCA) has routinely looked into media reporting that could indicate concerted practices in the field of “Preparing and serving food for immediate consumption or to take away”. Several takeaways in Ried im Innkreis, Upper Austria, were suspected of having engaged in anti-competitive concerted practices.

The AFCA launched a routine investigation following an article in a local newspaper. According to the article, the business owners “had jointly agreed to increase their menu prices to the same price.”

A total of five takeaway businesses were suspected of concerted practices. These businesses are just a couple of minutes apart on foot, and were offering several types of food at the same price. Kebabs, burgers, pizzas and similar foods were in some cases on sale at the same price in each establishment.

The business owners were each sent a warning letter in which the AFCA expressly stressed that price fixing, customer and market divisions, and the exchange of competitively sensitive information are all prohibited under the Federal Cartel Act (KartG).

Minor cartels - price fixing illegal even in small markets

So-called “minor cartels” are defined in the KartG, according to which cartels are exempt from the ban on cartels if competing undertakings jointly hold a total share of no more than 10% of the relevant market, or if undertakings that are not competitors each hold a total share of no more than 15% of the relevant market.

This exemption for minor cartels does not apply, however, to fixing retail prices, restricting production or distribution, or dividing up markets. The AFCA is obliged to routinely look into strong signs of suspected cartels even in the case of small markets, but may refrain from applying for a fine if the businesses concerned correct their behaviour.