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Rørforeningen - Abuse of dominant position (discrimination)

27. april 2005

Journal nr. 3/1120-8901-1258/FI/mco The Council Meeting 27th April 2005

On 27th April 2005, the Danish Competition Council adopted a decision concluding that Rørforeningen had abused its dominant position under section 11(1) of the Danish Competition Act and Article 82 of the Treaty.

Rørforeningen is an association of Danish wholesalers of plumbing and heating products. It organizes all the major wholesalers in Denmark. Rørforeningen is engaged in a classification system of plumbing and heating products for sale in Denmark through the wholesalers. Rørforen-ingen’s activities include the classification of new products and the pub-lishing of catalogues and CD’s. The catalogues and CD’s are distributed to professional users such as wholesalers, architects, construction com-panies, plumbing and heating engineers etc.

Rørforeningen is considered to have abused it dominant position on the market for complete registers of plumbing and heating products for pro-fessional use. The abuse consists of exclusionary practice in relation to wholesalers outside Rørforeningen.

The Competition Council considers it an abuse of a dominant position that requests for publication of new products from suppliers outside Rør-foreningen should go through members of Rørforeningen or suppliers al-ready in the database. It enables members of Rørforeningen to exclude or veto new supplier’s access to the register/catalogue. Rørforeningen has been ordered to abolish this requirement.

It is furthermore considered an abuse of a dominant position to require, that products should hold a market share of 5 % in order to be published in the printed version of the catalogue. Especially for new products this constitutes a barrier for access to the market. It also preserves the market for already established products from established suppliers. The require-ment that the products should be sold by at least 2 members of Rørforen-ingen is likewise considered an abuse of a dominant position. Rørforen-ingen has been ordered to abolish the two requirements.

The Competition Council considers it of importance that the terms for the use of the system are public. This will enable new suppliers to get ac-cess to the system. The Competition Council has ordered Rørforeningen to publish the terms for access to and use of the system.

Finally, it is considered an abuse of a dominant position that Rørforenin-gen acts as a control body for new or modified items. The Competition Council considers that Rørforeningen should only take care that the items fulfil the legislative requirements for product approval. Rørforen-ingen is ordered to specify, that plumbing and heating items should only fulfil the product specification pursuant to the legislation.