German Competition Regulator Fines AVM EUR 16 Million for Price-Fixing Scheme

Germany’s competition regulator, the Bundeskartellamt, has levied fines totaling nearly EUR 16 million against AVM Computersysteme Vertriebs, a leading manufacturer of telecommunications and network technology products headquartered in Berlin. The fines were imposed due to AVM’s engagement in illicit price coordination with six electronics retailers.

AVM, renowned for its FRITZ! brand of routers, repeaters, phones, and smart home products, was accused of obstructing the free formation of prices in the market. “AVM has coordinated increases of end consumer prices with electronics retailers, aiming for restricted price competition at the expense of end consumers,” stated Andreas Mundt, President of the Bundeskartellamt. “With the fines imposed, the Bundeskartellamt is sending a clear signal that violations of the prohibition of resale price maintenance will not be tolerated.”

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The investigation began with an anonymous tip submitted through the Bundeskartellamt’s whistleblower system (BKMS) and was followed by additional reports from other stakeholders. These reports led to a dawn raid on AVM’s premises in February 2022.

According to the Bundeskartellamt, AVM employees not only negotiated purchase prices with retailers but also coordinated the final prices that consumers would pay. This price coordination typically involved setting minimum sales prices, known as target prices, that were positioned between the recommended retail price and the retailers’ purchase price. This strategy effectively resulted in price hikes and restricted price competition, ultimately harming consumers.

Source: The Globe and Mine