Bundeskartellamt currently has no objection to food retail joint venture "Retail Trade Group"

04.04.2017

The Bundeskartellamt currently has no objection under competition law aspects to the planned cooperation between the food retailers Bartels-Langness, Bünting, Georg Jos. Kaes, Klaas & Kock, Netto ApS (Netto Nord) and Real in the newly formed RTG Retail Trade Group. The joint venture is to perform services for the parties in the areas of purchasing, e-commerce, logistics and administration. The parties will continue to operate their different distribution channels on the sales markets independently of one another. Nevertheless, possible effects of the cooperation on the sales side cannot be ruled out.

Andreas Mundt, President of Bundeskartellamt: "All things considered, we will tolerate this cooperation because the effects of further concentration in the food retail markets are limited and the project will also have significant positive effects. The four major food retailers EDEKA, REWE, the Schwarz group and Aldi dominate more than 85 per cent of the market. In this context the cooperation offers the opportunity to ensure the competitiveness and hence in the long term the independence of the smaller retailers, also as a sales alternative for the suppliers." 

The retailer Real operates self-service stores with food departments throughout Germany. Bartels-Langness, Bünting, Georg Jos. Kaes and Klaas & Kock operate supermarkets with different regional focuses. Netto Nord (not to be confused with Netto Markendiscount AG which belongs to EDEKA) is part of Dansk Supermarked A/S and operates discounter outlets in the north and north-east of Germany.

On the procurement side the joint shares of the RTG members amount to less than 15 per cent in all product categories and are therefore within the area of what is considered to be unobjectionable under European competition law.

In several regional markets companies represented in RTG compete with each other on the sales side. In some cases this leads to high joint market shares. At the same time the major competitors of the parties have high market shares on all the sales markets affected, which means that the scope of action of the RTG members will still be sufficiently controlled.

The parties have informed the Bundeskartellamt about their project since August 2016 and have submitted extensive data and documents. Against this background the authority informed the parties that based on the knowledge available, it would not take up the project, especially the joint purchasing activities.  However, it also pointed out to the parties that a more intensive examination under competition law might be carried out at a later date if the cooperation were extended or intensified, especially on the sales side.


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