The Paris Court of appeal upholds a decision of the NCA fining a manufacturer for exclusive distribution agreements and RPM but annuls the part of the decision regarding rebates (Royal Canin)

Background In a decision dated June 22, 2005, the French Competition Authority (“FCA”) imposed a fine of € 2,500,000 on Royal Canin, a manufacturer of pet food, and fines ranging from € 1,000 to € 1,500,000 on several of its wholesalers and retailers. [1] The FCA held that (i) Royal Canin and its wholesalers had entered into a vertical agreement by which each wholesaler was granted a territorial exclusivity, committed to serve only specialized retailers, and applied predetermined resale prices; (ii) Royal Canin, its wholesalers, and retailers had entered into a vertical agreement by fixing the retail prices of Royal Canin products, (iii) Royal Canin had abused its dominant position by granting to its clients rebates conditional on the volume of sales and on its annual rate of increase.

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David Spector, The Paris Court of appeal upholds a decision of the NCA fining a manufacturer for exclusive distribution agreements and RPM but annuls the part of the decision regarding rebates (Royal Canin), 14 April 2006, e-Competitions Bulletin Rebates, Art. N° 1381

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