Competition Law in Germany
Ensuring fairness in the market is vital in regulating it. Without fairness in the market, companies can operate in any manner they wish, which would be detrimental to the consumer and new firms entering the competition. For consumers, competition law ensures that firms operate responsibly when advertising and promoting their product. Whereas allowing new firms into the marketplace is good for innovation and ensures that all firms improve and provide the best service. On this front, competition law is primarily based on two main areas: antitrust and unfair practices.
With the number of rules and regulations in the field of German and European competition law, it is not unusual for companies to come into conflict or potentially come into conflict with the law. Receiving expert support from German competition lawyers is the best answer should you face these issues. Our multidisciplinary legal team provides legal assistance to a diverse range of both domestic and international clients. Here we have listed some of the services we offer in the field of competition law.
- Arbitration services
- Cartel investigation and representation
- Aid in relation to government investigations
- Ensure that advertising is compliant with regulations
- Defence in claims of unfair practices
- Trademark and copyright enforcement
Antitrust Law: Legal Guidance by German Competition Lawyers
Antitrust law is designed to prevent price-fixing, anti-competitive practices and the abuse of a dominant position within the marketplace. Allowing cartels to develop results in newer firms being prevented from entering the market and long-term this inhibits innovation. Antitrust and prevention of cartels is seen as an important part of the work of the European Union. In Germany, this area is regulated by the German Restraints of Competition Act. It works alongside European Union legislation on the issue such as Article 101 Treaty on the Functioning of the EU. This Act is quite detailed as it outlines the law relating to competition law and how cases are legislated for, the appeal process and what is meant by firms abusing their dominant position within the market.
At Schlun & Elseven Rechtsanwälte, we provide clarity regarding practices that could be considered anti-competitive. Our lawyers provide their expertise to companies when it comes to mergers and acquisitions and in other business transactions. It is often in M&A cases that claims of anti-competitive practices can be made and drawn-out legal battles can commence. Therefore, it is invaluable to have a competition lawyer available to assist the process and ensure that everything is above board. Our lawyers provide reliable advice that focuses on all aspects of the transactions.
Accusations of Cartel Activities
The Act Against Restraints of Competition outlines in § 1 GWB that it is against cartel activities. The goal of such activities is defined under the Act as the following:
Agreements between undertakings, decisions by associations of undertakings and concerted practices which have as their object or effect the prevention, restriction or distortion of competition are prohibited.
Should your company face an investigation due to an accusation of a cartel, it is advisable to contact our competition lawyers. During such an investigation, companies can face serious disruptions which they must be prepared for. Among the actions which the authorities can take during this time are the following:
- Compulsory interviews,
- Unannounced searches of premises
- Demands for certain documents,
- Seizure of electronic devices.
Should a company be found liable for cartel activity they can face huge fines. The amount fined will depend on the case’s facts with major sanctions reaching a maximum of 10% of worldwide turnover from the previous year. Liability can also lead to major fines on the individuals involved.
If you are aware of such an investigation into your company, it is important to have a German competition lawyer in your corner to provide the advice you need. Expertise in the field of German competition law means that you can have your legal concerns answered, and our experienced professionals can guide you through how to respond to such accusations. Contact our lawyers today using the form below this article.
The world of business is a competitive environment. However, this competition is also based on rules and fairness. Without such restrictions, companies would carry out any actions they wished, contributing to a race to the bottom. By having rules about what is considered fair and unfair practices, companies have to show they deserve to be at the forefront of the market based on their quality and what they offer rather than through unfair means. Furthermore, competition law in this area is in place to ensure that customers are not deceived through the advertising and labelling employed by companies. By establishing a competitive environment based on fairness, consumers can decide which products they wish to purchase in a more informed manner.
Unfair practices in competition law include inaccurate advertising, false labelling on products/trademark infringement, and product imitation. In this area, it tends to be the responsibility of individual firms to counter competitors they believe are engaging in anti-competitive practices.
Countering Unfair Practices
To counter these competitors, the first call of action is usually a “cease-and-desist” letter. Before launching this letter, it is advisable to offer legal assistance and advice about what can and what should not be in the letter. It is also worth establishing why such suspicions exist and what proof (if any) the company has against its competitor’s alleged unfair practice. Should this all be above-board, and the letter is sent, the competitor can accept or challenge the cease-and-desist letter. Should they provide a challenge to this letter by claiming that they are not engaging in such unfair practices, then it is possibly worth considering bringing an injunction action against them and seeking a court order to force the competitor to disclose their records.
At this point in affairs, the company should really have a German competition lawyer on board to establish its own moves. In that regard, contacting our firm will allow us to outline the case’s specifics to a member of our competition law team. From there, they can provide the necessary counsel for that specific situation.