J. Sroczyński for WuW No. 9/2013 – Decision of the President of the OCCP concerning franchise agreements in the catering services market
The President of the Office of Competition and Consumer Protection (the “OCCP”) has issued a prohibiting decision to Sfinks Polska, franchisor of a restaurant network operating under the tradename Sphinx. Sfinks Polska has been fined over 100,000 euro for imposing fixed prices for meals sold by franchisors in the restaurants. Franchisors were also precluded from freely engaging into promotional activities. These restrictions were introduced for the first time in 2000 and were sanctioned in franchise contracts by contractual penalties and termination clauses. The decision is quite precedential, since franchise agreements were so far only exceptionally dealt with by the OCCP. In this case, the OCCP pointed out to a harm for consumers even though only 45 Sphinx restaurants are operated in Poland under the franchise. The harm was defined as the lack of opportunity to purchase cheaper meals in the franchise network. Sfinks Polska lodged an appeal from the OCCP’s decision with the first-instance Court of Competition and Consumer Protection.
Several proceedings were initiated in other cases involving resale price maintenance. These include proceedings against three importers of watches, The Swatch Group (Polska), PHU Jubiler and Anyro&Co, who were challenged with allegations of fixing resale prices with distributors of Citizen, Swatch, Hugo Boss, Longines, Tissot, Rado, Certina and others watches. Another case pertains to the same practice on the bicycle market, where the proceedings were opened against Ski Team, a distributors of Cube bicycles. The OCCP raised allegations also against PM Sport, an exclusive importer of ski and snowboard equipment, for engaging into resale maintenance practices with distributors of Rossignol, Dynastar and Lange products.
The OCCP initiated the antimonopoly proceedings against Polskie Górnictwo Naftowe i Gazownictwo (PGNiG), a gas incumbent holding a 98% market share on the Polish market for retail sales of gas. PGNiG has been faced with allegations of abusing the dominant market position by preventing its distributors from the possibility to decrease the annual contracted quotas of gas and restricting the freedom to resell gas purchased from PGNiG. Both practices will be assessed in a decision of the OCCP upon termination of the proceedings.
The OCCP has fined ITI Neovision 2.75 million euro for violating the collective consumer interests in connection with an introduction of a new television platform “nc+”. ITI Neovision had unilaterally modified various vital conditions of binding contracts with the current subscribers, mainly to their detriment. In addition, it had failed to comply with numerous information obligations, which Polish law requires to include in contracts concluded with consumers. The OCCP has largely grounded its decision in the fact of an abuse by ITI Neovision of the principles of business ethics.
Gaspol has secured a conditional approval for its acquisition of assets of Orlen Gaz. Both companies are the largest players on the fuel market. Gaspol notified an intention to acquire selected assets of Orlen Gaz, including rights and obligations, pertaining to the sales of bottled gas. The OCCP has established that the transaction would significantly impede competition in the regional markets of Eastern Poland. Accordingly, the OCCP imposed a condition aimed to decrease Gaspol’s market shares on these regional markets. Gaspol has been obligated not to undertake any active steps to take over Orlen Gaz clients during one year after accomplishment of the transaction. The OCCP also prohibited both companies from exchanging information concerning the current customers of Orlen Gaz.
This decision is the 16th conditional decision of the OCCP since 2004 and the first conditional decision issued in 2013.
J. Sroczyński, Wirtschaft und Wettbewerb. Developments in national competition law, No. 9/2013.
