Accepted Commitments by Duing and Fred Bobek

The Croatian Competition Agency (CCA) closed two proceedings for the establishment of prohibited agreements by accepting commitments proposed by the parties concerned – Duing d.o.o. from Viškovo and Fred Bobek d.o.o. from Vodice active in the sales and servicing of the outboard engines.

Concretely, the undertaking Duing, concluded sales agreements for the marine engines of Volvo Penta, Tohatsu and ZF Marine, whereas Fred Bobek concluded distribution and servicing agreements for Honda Marine engines and other products.

In both cases the CCA based its case on the indices that the agreements concluded with their partners and repair shops contained provisions that contravened competition rules.

Duing included RPM clauses its agreements where it, in other words, imposed on its partners and repair shops prices for final consumers as determined in its price list. At the same time it imposed on the repair shops the obligation to resell exclusively Volvo Penta and Tohatsu original spare parts that had been exclusively purchased from Duing. If the partner had not complied with these restrictions it would have been excluded from Duing servicing and resale network. Above all, had the repair shop purchased Volvo Penta and Tohatsu spare parts from any other supplier, Duing could have terminated the agreement at any time.

In the case of the undertaking Fred Bobek there were indices that by increased pressure on the margin it restricted its distributors to freely set the resale price. At least one of the distributors was imposed a non-compete obligation after the expiry of the contract.

After the CCA opened the proceeding the undertakings in question proposed the remedies aimed at eliminating the provisions under the agreement raising competition concerns.

Duing committed itself to conclude with its current partners and repairers new agreements that would not contain any anticompetitive provisions. This would also apply to any future agreements.

Fred Bobek committed itself to change the RPM provisions determining the sales margin in the agreements with its distributors and repairers and to clearly define that the recommended prices contained in the price lists, agreement or elsewhere are not binding. The non-compete restrictions after the expiry of the agreement would be deleted.

The CCA published the committments offered by the undertakings concerned on its web site (market test) and received no comments of the competing undertakings or other interested parties.