The Austrian Federal Competition Authority (AFCA) published its Report relating to the Fair Competition Act (FWBG) on 26 February 2024. In addition, the AFCA filed another application with the Cartel Court to impose a fine on a wholesaler in connection with the sale of agricultural and food products on the same date (see also link below).
The Annual Report
The AFCA is the authority in charge of enforcing the FWBG and is obliged to prepare an annual report on its activities in this context. The Report includes the number of complaints received over the past twelve months and all investigations that were either initiated or concluded in the previous year.
For an overview of all matters related to the FWBG, please refer to the following AFCA subsite: Combating unfair trading practices in the agricultural and food supply chain
Key findings of the Annual Report
Buyers, particularly those in the food retail sector, are exerting pressure on suppliers of agricultural and food products. The food retail industry is a concentrated market dominated by four large retailers, as has already been shown in the Sector Inquiry into the food industry. Food retail is the most important sales channel for 71.6% of suppliers. This means that there is an obvious supplier dependency on their buyers – four fifths of all suppliers are exposed to clearly negative effects.
The following unfair practices, which are prohibited according to Annex I to the FWBG, were used most frequently:
uppliers agree to these unfair practices for various reasons:
- For their own benefit
- For their mutual benefit
- Owing to pressure exerted by the buyer
- Owing to a fear of serious economic consequences
- Due to a lack of concern about them.
The AFCA assumes that many concerned suppliers do not dare to complain out of fear of repercussions for them. The number of unreported cases is therefore thought to be high.
Breaches relating to unfair trading practices as defined in Annex II to the FWBG were reported by 3-5% of complainants.
We wish to point out that the AFCA will give absolute priority to pursuing unfair trading practices.
AFCA’s recommendations to combat these issues:
- Ex officio sector inquiries
- Mandatory written form for all agreements within the scope of the FWBG
- Equivalence of practices listed in Annex II with those in Annex I, since the former are only prohibited unless clearly and unambiguously agreed beforehand in the supply agreement or any subsequent agreements
- Regular exchange with other enforcement authorities/institutions.
The full report can be downloaded from the following link (in German): Report pursuant to § 5h para. 3 FWBG
FWBG cases published by the AFCA to date
Unfair trading practices: AFCA files applications with Cartel Court for fines on MPREIS in 16 cases
Unfair trading practices towards fruit growers: AFCA files application with Cartel Court to have wholesaler fined
