Dutch Competition Authority Accuses Bike Makers and Associations of Price Fixing

THE HAGUE, The Netherlands (November 28) - Dutch competition Agency (NMa) published today a report in which the biggest bike makers in Holland are accused of price fixing. According to NMa Royal Gazelle, Accell Group (Batavus, Koga, Sparta) and Giant Europe, representing 70–80% of the Dutch market, formed a cartel on sale prices of new bicycles. Next to this Gazelle, Accell, Giant and Union participated each in a system to exchange competition-sensitive information, such as market shares, prices and market trends, bi-monthly since 1998. Coordination between companies, which eliminates risks of mutual competition, while replacing this by actual cooperation violates the anti-trust law. Accell chairman René Takes reacted: "No data distribution between the companies takes place. It is also completely inaccurate that during meetings between companies business prices are regulated." Also Gazelle MD Klaas Dantuma denies the price consultation. "Nonsense. All manufacturers purchase at the same suppliers and when they increase their prices all bikes become more expensive. That is the only reason, that prices follow each other. We maintain our own price policy", says Dantuma. Also an accusation has been filed at two Dutch branch organizations Bovag and NCBRM. According to NMa they pressed their IBD-members, not to cooperate with two big sellers of so-called ‘company bicycles’ (bikes sold with fiscal incentives). According to Bovag and NCBRM the profit margins, which these two companies (Bedrijfsfiets Nederland and NFP) offered to IBDs upon sale of ‘company bikes’, were too low. Beside both associations advised their IBDs on consumer prices and service/repair rates, says Nma, which violates the anti-trust law by restricting competition. Both associations blame the NMa for nitpicking. NMa allows concerned parties to react on its reports within 6 weeks from now. After this NMa will determine whether or not a violation is definite. If yes, a fine or penalty will be imposed at the Dutch manufacturers and associations. Overall the Dutch manufacturers could be faced with a fine up to 10% of their annual turnover. (FN)