Bundeskartellamt gets GARDENA to amend its dealer discount system

Bonn, 28 October 2013: The garden product manufacturer GARDENA has promised the Bundeskartellamt that in future it will apply the same discounts for its brick-and-mortar and online retailers. In awarding retailer discounts the company will no longer differentiate between the methods of distribution. The Bundeskartellamt had reacted to complaints by online retailers and initiated proceedings. The authority was now able to terminate the proceedings on account of the commitments undertaken by the company.

Andreas Mundt, President of the Bundeskartellamt: "We are currently receiving a number of complaints about alleged restrictions of online trading. However, we need to differentiate between the allegations. In structuring his distribution system a manufacturer may well take account of the different conditions in the different distribution channels. Nonetheless, he should always be well aware of the fact that he cannot simply eliminate or discriminate against online sales. In GARDENA's case we were able to find a quick and constructive solution: The new conditions no longer differentiate between brick-and-mortar and online sales."

The Bundeskartellamt had assessed the discount system recently introduced by GARDENA and found that it discriminated against online trading. Consequently it initiated proceedings against the company. The contentious issue were so-called staggered trade discounts which GARDENA awarded to retailers on the basis of which sales channel (brick-and-mortar or online) they used to sell its products. In the Bundeskartellamt's view this amounted to an illegal dual pricing system because the functional discounts were structured in such a way that only brick-and-mortar retailers were able to benefit from the full discount. GARDENA will inform its dealers about the amendment to its discount system in a separate letter.