Reed Smith Client Alerts

In a decision dated 5 December 2018, the French Competition Authority severely fined six household appliance manufacturers – all among the largest in the sector – for having agreed on price increases charged to end-consumers and commercial terms applicable to their kitchen installers.

The €189 million fine is the tenth highest fine imposed for cartel activities by the French Competition Authority since 2000.

On 5 December 2018, the FCA sanctioned six household appliance manufacturers a total of €189 million for having engaged in cartel activities by jointly setting (i) increases in recommended retail prices enforced by their distributors when selling products to end-consumers, and (ii) the commercial terms applied to kitchen installers for the displayed models.

The typical features of a cartel illustrated in this case

Although the cartel was qualified as “sophisticated” by the head of the FCA, the main features emphasised in the decision were, in fact, those of a textbook cartel:

  • A cartel comprising the largest market players in the sector, together representing up to 70 per cent of the market and the best-known brands
  • Price fixing practices relating to mass consumption goods (household appliances such as refrigerators, washing machines, dishwashers and freezers)
  • Secret meetings at the highest company level and in luxurious restaurants
  • Unofficial meetings and phone calls before and after official meetings within the trade association.