Agreement on prices in household appliances: 12 manufacturers and distributors sanctioned for their practices

Ten appliance manufacturers (new window) and two distributors were sanctioned, Thursday, December 19, by the French Competition Authority for having colluded in order to maintain higher sales prices between February 2007 and December 2014. They will have to pay a total of 611 million fine euros. The sanctioned companies are, according to a press release from the Competition Authority (new window)BSH, Candy Hoover, Eberhardt, Electrolux, Whirlpool (as successor to Indesit), LG, Miele, SEB, Smeg, Whirlpool, Boulanger and Darty.

The objective of these “vertical agreements” was from “reduce competition, particularly from online distributors, and maintain high sales prices for consumers”specifies the Authority. The means put in place ranged from banning the sale of certain products on the Internet to communicating “recommended retail prices” by manufacturers with “a coded language to hide price instructions”followed by a “surveillance” to ensure that distributors respected them.

The “weight” of Darty and Boulanger

Distributors active exclusively on the Internet claimed to have been discriminated against if they did not have physical stores. “Traditional distributors, including the two main ones, Darty and Boulanger, fully participated in these agreements”underlines the Competition Authority, insisting on the “weight” of the two behemoths which sought to ensure that “the products they sold would not be significantly cheaper elsewhere, particularly online”.

Fnac Darty indicated in a separate press release that the amount of its fine amounted to 109 million euros. From the first half of 2023, the group had provisioned 84 million euros in anticipation of this sanction and it announced this Thursday that it “will record an additional charge of 24 million euros for the 2024 financial year, without impact on current operating income”. Like nine others, Fnac Darty had decided not to contest the complaint notified by the Competition Authority for “quickly end a complex procedure” and devote himself to his “strategic plan”.

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The manufacturer SEB and the distributor Boulanger chose to contest the complaints and were fined 189.5 and 84.35 million euros respectively. In a press release, SEB indicated that it “will file an appeal” before the Paris Court of Appeal, rejecting “any allegation that its practices did not comply with competition rules”. Electrolux, for its part, declared in a press release that it had taken note of the sanction (44.5 million euros), provisioned in its accounts from 2023. A first sanction, for a total amount of 189 million euros, had been pronounced in 2018 in the same case against six of the manufacturers affected by this Thursday’s decision.