Rewe Criticizes Record Cartel Fine Sharply

"The alleged offense - the failure to report the location - did not lead to any economic advantages for Rewe International AG," said the Billa parent company Rewe regarding the record cartel fine recently imposed by the Supreme Court (OGH) as the cartel court.

Rewe Announces Review of Legal Options After Record Cartel Fine

The supermarket chain still wants to "examine all possible legal options" to "appeal the judgment". The Rewe case dates back several years: In mid-2018, the then subsidiary Merkur Warenhandels AG (now Billa Plus) took over retail space for a grocery store in the WELAS Park shopping center in Wels, where Weiß Handels GmbH had previously operated a grocery store. This process was initially not reported as a merger to the Federal Competition Authority (BWB). The German Rewe Group includes Adeg, Billa, Billa Plus, Bipa, and Penny in Austria.

For antitrust expert Peter Stockenhuber from the University of Vienna, the cartel court decision regarding Rewe is completely understandable. "The OGH is merely correcting a gross misjudgment by the cartel court," Stockenhuber told APA on Thursday. Failing to report a merger to the BWB is "not a trivial offense." The cartel court has been saying for some time that "cartel fines should be raised to an international level," Stockenhuber said. The antitrust expert also referred to the Spar case in 2015, where the OGH as the cartel court increased the fine originally imposed by the cartel court from 3 million euros to 30 million euros. In connection with the founding of the mask manufacturer Hygiene Austria in spring 2020 by Lenzing and Palmers, the cartel court increased the fine against Palmers from 5,000 euros to 100,000 euros in autumn 2024.

The merger, i.e., the takeover of the location by Rewe, was subsequently reported in 2022 - and also approved. It is therefore actually a formal error, said BWB spokesperson Sarah Fürlinger to the "Salzburger Nachrichten" (Wednesday edition). The professor of antitrust law at the Vienna University of Economics and Business, Viktoria Robertson, described the record fine for Rewe as a "bombshell" to "Ö1". The determination of the record fine is based on the annual turnover of the German Rewe Group of over 92 billion euros in 2023. The upper limit for cartel fines is up to 10 percent of turnover, i.e., up to 9 billion euros. "Fines under the cartel law pursue preventive and repressive purposes, which requires an appropriate amount, otherwise no deterrent effect is achieved," explained the Supreme Court on Tuesday. The OGH has "already repeatedly clarified that fines of a magnitude are to be imposed in Austria to effectively combat cartel violations, as is already common at the Union level and in numerous member states."

After Record Cartel Fine: Rewe Cannot Comprehend the Amount of the Fine

The OGH as the cartel court increased the fine originally set by the cartel court for Rewe from 1.5 million euros to 70 million euros after appeals by the BWB and the Federal Cartel Attorney. Rewe pointed out regarding the OGH decision that they "relied on the justifiable legal opinion at the time of the procedure that the rental of the affected location in Wels was 'not subject to notification'." "A subsequent notification took place - and the takeover of the location was approved," emphasized the supermarket chain. "Such a draconian penalty to achieve deterrent effects is, however, sustainably detrimental to Austria as a business location."

For Rewe, the amount of the fine for "a formal violation" is incomprehensible. "It is as if someone were required to pay a fine equivalent to the value of a new car for a wrongly filled parking ticket to demonstrate that parking tickets must be filled out correctly," the statement said. The "disproportionateness" of the penalty amount is a "demonstration on behalf of the entire economy".

The previously highest cartel fines ever imposed in Austria were received by Porr (62.4 million euros) and Strabag (45.4 million euros) as part of the construction cartel. "We will shoulder any possible fine, neither customers nor employees will be burdened by it," explained the management of Rewe International. There will be "no personnel savings - no reduction in hours or job cuts - in the company." Nor will the fine be "passed on to the prices for customers."

(APA/Red)

This article has been automatically translated, read the original article here.