Background Praktiker, one of the leading DIY groups in Germany and Europe, pursues a dual distribution strategy via company owned stores and (few) franchises. The franchise contracts foresaw an exclusive sourcing obligation pursuant to which the franchisees had to source their entire demand of DIY related goods with the central sourcing company of the Praktiker group. Praktiker's central sourcing allowed for considerable economies of scale. However, the discounts, bonuses and kick-backs Praktiker generated as a result of its central purchasing were only partly passed-on to its franchisees. Following a complaint by one of the franchisees, the German Federal Cartel Office (FCO), in May 2006, came to the conclusion that the combination of (i) the exclusive purchasing obligation and
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The German Federal Court of Justice holds that discrimination between own stores and franchisees is not abusive (Praktiker)
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