CCA fines Spinnaker HRK 350,000,00 for infringement of competition rules

The Croatian Competition Agency found that the undertaking Spinnaker distribucija d.o.o. breached competition rules in the distribution market for POV action cameras in the territory of the Republic of Croatia by the conclusion of the Standard Selective Distribution Agreement with ten authorised retailers in effect form 1 April 2018 to 31 March 2019. The Standard Selective Distribution Agreement contained provisions that constitute hard core restriction of competition by object and therefore are prohibited within the meaning of Article 8 paragraph 1 of the Competition Act and Article 9 paragraph 1 item d) of the Regulation on block exemption granted to certain categories of vertical agreements, given the fact that it contained the restriction of cross-supplies between distributors within a selective distribution system.

The challenged provisions imposed on the appointed dealers to purchase the GoPro cameras exclusively from Spinnaker but also imposed an obligation causing the authorised dealers not to sell to other authorised dealers but exclusively to end users. In order to ensure the authorised dealers’ compliance in practice, Spinnaker imposed a quantitative restriction on its authorised dealers by requiring a fixed number of cameras per sales.

The restriction of cross-supplies between distributors within a selective distribution system is a restriction of competition by object, which does not require any further analysis of the relevant market that would justify such a behaviour. In other words, selected distributors must remain free to purchase the contract products from other appointed distributors within the network, operating either at the same or at a different level of trade. Therefore, it was not necessary to conduct an individual assessment in order to demonstrate concrete restrictive effects in the market and whether these effects were significant or not. In this particular situation, the vertical agreement concerned could not be grated block exemption, which makes it ex lege void.

For the serious infringement of competition rules Spinnaker was fined HRK 350,000 and prohibited any such behaviour in the transactions with the authorised dealers (retailers) of GoPro products in the future.

When setting the fine the CCA took fully into account the type of infringement, the way of participation in the prohibited agreement, the geographic area in which the infringement had or might have produced effect and the fact whether the infringement was actually committed in practice or it was merely likely to have happened. It is the view of the CCA that the fine in the amount specified above will have a sufficiently deterrent effect, not only in order to sanction the undertaking concerned but also in order to deter other undertakings from engaging in, or continuing, behaviour that is contrary to the provisions of the Competition Act.