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The Danish Competition Council Accepts Commitments from Dagrofa ApS

23. oktober 2013

On October 23 2013 the Danish Competition Council (“DCC”) adopted a commitment decision that approves an envisaged reorganization of Dagrofa ApS (“Dagrofa”) and the supermarket chains SuperBest and Spar.

Dagrofa is the parent company of the Dagrofa group. The undertaking is mainly active on the grocery wholesale market and sells groceries, inter alia, to the SuperBest and Spar supermarket chains. However Dagrofa is also active on the grocery retail market as it owns a number of supermarkets in the SuperBest and Spar chains.

The Danish Competition and Consumer Authority (the “DCCA”) found that the envisaged reorganization gave rise to certain competition law concerns in relation to Section 6 and Section 11 of the Danish Competition Act and Article 101 and Article 102 of the Treaty on the Functioning of the European Union.

The DCCA’s concerns in relation to Section 6 and Article 101 were horizontal in nature and related to (i) recommended resale prices and maximum prices and (ii) information exchange.

The DCCA’s preliminary investigations showed that Dagrofa’s envisaged setting of recommended resale prices and maximum resale prices did not give rise to competition concerns in relation to Section 6 and Article 101.

However the DCCA’s preliminary investigations showed that Dagrofa’s envisaged information exchange gave rise to competition concerns in relation to Section 6 and Article 101.

The DCCA’s concerns arose from the fact that while some of the supermarkets within the SuperBest and Spar chains are owned by Dagrofa, many are owned by independent retailers. As a result, some of the supermarkets within the two chains are vertically integrated and some are independent.

Dagrofa offered commitments in order to remedy the DCCA’s concerns in relation to Section 6 and Article 101 which the DCCA has accepted and made binding.

The DCCA’s concerns in relation to Section 11 and Article 102 related to (i) exclusive purchasing obligations and (ii) Dagrofa’s right of first refusal to supermarkets owned by independent retailers in the SuperBest and Spar chains.

The DCCA’s preliminary investigations showed that Dagrofa might have a dominant position on the grocery wholesale market in Denmark. As a result the DCCA investigated whether the envisaged provisions would be able to foreclose competition on the relevant markets.

The DCCA’s preliminary investigations showed that that there were no grounds for action in relation to Section 11 and Article 102.