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French retailers Casino, Intermarché in EU antitrust probe

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French retailers Casino, Intermarché in EU antitrust probe

Supermarket - Photo by Tomasz Sienicki

(BRUSSELS) - The EU Commission opened an antitrust investigation Monday to assess whether the French retail groups Casino and Intermarché breached EU competition rules by coordinating their conduct in the market.

Casino Guichard-Perrachon (known as 'Casino') and Les Mousquetaires (known as 'Intermarché') are two of the largest chains of groceries retail shops active in France. In November 2014, they set up a joint venture for the joint procurement alliance of their branded products, INCA.

The Commission investigation centres around whether Casino and Intermarché coordinated their activities in an anticompetitive way.

"Buying alliances between retailers have become a key component of grocery supply chains, said the Competition Commissioner Margrethe Vestager: "They can bring lower prices to consumers for food and personal care brands that they purchase on a daily basis. Such benefits can however disappear quickly if retailers use these alliances to collude on their sales activities."

The Commission is concerned that Casino and Intermarché went beyond the purpose of their alliance and engaged in an anticompetitive conduct. In particular, the Commission will investigate whether Casino and Intermarché coordinated their activities on the development of their shop networks and their pricing policy towards consumers.

The Commission notes that such buying alliances usually aim at the creation of purchasing power, which can lead to lower prices or better quality products or services for consumers. Retailers' alliances are seen as positive when the benefits are passed on to consumers.

However, alliances can give rise to competition concerns, when multiple contacts between retailers can lead them to collude on their retail sales activities.

If proven, this coordination may breach EU competition rules on anticompetitive agreements between companies (Article 101 of the Treaty on the Functioning of the European Union).

The Commission says it will now carry out its in-depth investigation as a matter of priority. It is important to note that the opening of a formal investigation does not prejudge its outcome.

More information on the investigation will be available on the Commission's Competition website, in the public case register under the case number AT.40466.

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