Understanding competition

Compelling expertise for the last 25 years

The competition economic analysis of agreements between companies has grown in importance in recent years for a variety of reasons: both European and German antitrust law demand companies to weigh the impact of their market conduct themselves. To this end, business cooperations and alliances must judge whether the information exchange, agreements or deals between the companies in question have anticompetitive consequences, which could cause disadvantages for consumer welfare. However, many cooperations and arrangements can be exempted, if proven efficiency effects lead to an adequate rise in consumer welfare.

In such cases, the necessary conditions are:

  • The restriction of competition is essential to generate efficiency.
  • Competition is not abolished.
  • The benefits are passed on to the consumer to an adequate extent.

Extensive economic expertise is essential here due to the complexity of market conditions, not only in proving efficiency, but also in precisely and reliably estimating potential losses for the consumer.

Horizontal cooperations between competitors are subject to cartel prohibition. They can, however, be absolved if they meet relevant competitive parameters (such as prices) whilst setting technical standards that are essential for efficient market functioning at the same time.  Research cooperations may also be admissible. We have considerable experience in the analysis of cartels of small and medium-sized businesses and of condition cartels.

Vertical restraints often affect the distribution channels of end products, for example exclusive product distribution or the support of trading partners with credit via manufacturers, who accept minimum-purchasing requirements in return. In a variety of consultancy projects, our competition-economic analysis of distribution channels and restrictions such as minimum purchasing quantities, pricing recommendations and exclusive agreements or most-favoured supplier clauses has served as the basis for self-assessments compatible with antitrust law.

Furthermore, we have experience in the competition-economic analysis of Hub & Spoke cartels and matters that, together with the outcome of vertical information exchange, arise from purchaser pricing. Proof of the efficiency effects in accordance with article 1 section 3 of the TFEU in connection with the umbrella vertical block exemption (vertical block exemption 1400/2002, vertical block exemption 330/2010) as an outcome of restrictions, which traders in selective distribution systems are subject to, also belongs to our broad spectrum of knowledge.