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NMa Confirms Infringement of Prohibition on Cartels by Bicycle Manufacturers

Following an administrative appeal procedure, the Netherlands Competition Authority (NMa) has confirmed that three bicycle manufacturers infringed the prohibition on cartels. The fines imposed earlier on these parties were reduced to EUR 26,557,000 (from EUR 29,685,000).

NMa adopted the advice of the independent administrative appeals advisory committee. In addition, the decision on the administrative appeal was also presented to the European Commission, which had no comments.

In April 2004, NMa imposed fines on three bicycle manufacturers, Accell Group N.V., manufacturer of, for instance the Batavus and Koga brands, Koninklijke Gazelle B.V. and Giant Europe B.V. NMa held that it had been established that the three manufacturers coordinated their behaviour, for instance by determining recommended retail prices for the cycling season 2001. This infringement was upheld in the administrative appeal, but the fines were reduced by 10%.

The level of the discount which Nationale Fietsprojecten B.V. (a supplier of company bicycles) gives bicycle retailers was on the agenda of the consultation between bicycle manufacturers. This was not deemed to be an infringement in the report in which NMa announced its suspicion that an infringement had been committed, but was included as an infringement in the contested decision imposing a fine. As a result, the bicycle manufacturers could not defend themselves on this point after the report was presented. In relation to this specific circumstance, on the advice of the independent administrative appeals advisory committee, NMa decided to reduce the fine. To determine the level of the fine, NMa applied its Guidelines for the Setting of Fines.

In the decision on the administrative appeal, NMa also applied the Europe prohibition on cartels. NMa is obliged to do so following amendments to European competition law in May 2004, the so-called Modernisation. In accordance with these amendments, NMa is required to present its draft decision to the Commission.

It is possible to file a judicial appeal against this decision on the administrative appeal with the Court of Rotterdam and after this with the Trade and Industry Appeals Tribunal.