In the Netherlands, cartels are illegal. This is specified in the Dutch Competition Act (Mededingingswet). A cartel agreement is an agreement between competitors with the intention of hindering or restricting competition, or creating false competition. Cartel agreements can also exist between suppliers and buyers, for example on the retail prices. Cartels disadvantage consumers and obstruct competition.
Agreements you are not allowed to make
You are not allowed to enter into agreements with competitors on for instance:
- raise prices in joint agreement
- offering no discount
- apply minimum prices
- pass on surcharges
Even just talking about prices with your competitors is forbidden.
Price agreements between suppliers and buyers
Suppliers and buyers can make cooperation agreements as long as all parties are free to do business and compete. A supplier can for instance recommend a list price but cannot set the retail price. The purchaser must be able to set their own resale price and cannot be pushed to follow the recommended list price, for example by threatening a supply stop. Less direct coercion such as continuous sending messages or calling about the list price is also not alllowed.
You may not arrange with your competitors to divide the market between you. For example:
- not supplying each other’s customers
- not supplying in each other’s area
- you sell product A and your competitor sells product B
- arrange for different periods for discounts
Agreements on tendering
You are prohibited from entering into agreements with you competitor regarding tenders or discuss quotations. Among others you may not make agreements:
- to share an order
- to refrain from participation in certain tenders
- to not accept certain conditions
- price fixing at the time of the tender
- to jointly carry out the assignment when this is unnecessary
Agreements on purchasing
You may not enter into agreement with your competitor on the price you will pay a supplier, or boycott certain suppliers. You may not even talk about purchase prices with competitors.
Agreements on salaries
You may not enter into agreements with competitors on employment conditions such as:
- salaries, allowances or bonusses
- taking over of personnel
- rates for freelancers
Cartel offense prosecution
If you violate the cartel ban, the Netherlands Authority for Consumers and Markets (Autoriteit Consument en Markt, ACM) can fine you. If a cartel agreement limits trade among European Union Member States in general, the European Commission may impose fines as well. Should you want to leave a cartel you can report this to ACM (leniency request). You will not be fined or your fine may be reduced.
Reporting a cartel
If you suspect that companies are in a cartel agreement, you can tip off the ACM (in Dutch). You can find out more information about cartels and the possibilities to lodge a complaint in ACM’s ICN anti-cartel enforcement template.
Exceptions to the cartel ban
There are exceptions to the cartel ban and in those cases you can make arrangements with competitors.
If an agreement contributes to economic or technical progress, it might be permitted. The agreement may only cover that what is strictly necessar and is only allowed if:
- the agreements make work more efficient and thus increase prosperity
- a fair share of the benefit from such agreements goes to the clients.
- the benefits can only be achieved by restricting competition
- there still must be room for competition
In some cases, agreements between small businesses are allowed. This is called trivia exemption (bagatelvrijstelling). Entrepreneurs are allowed to make cartel agreements if:
- there are no more than 8 participating companies
- their annual turnover is no higher than €5.5 million (goods) or €1.1 million (all other cases)
The trivia exemption is also valid if entrepreneurs with a small market share make arrangements. You can only make cartel agreements if:
- your combined market share is no higher than 10%
- your agreement does not lead to a restriction of the intercommunal trade.
Sector protection exemption
Sector protection agreements are permitted. A sector protection agreement is an agreement between the manager of a new shopping centre and an entrepreneur whose shop is in that shopping centre. It protects the shopkeeper from competition from new arrivals in the shopping centre who operate in the same sector.
Cooperation in the retail sector
Collaboration agreements are also allowed in the retail sector. Retailers can make agreements about for instance marketing, joint advertising or joint purchasing.
European law provides for exemptions for certain categories of research and development, technology transfer and specialisation agreements.
If you want to check whether you are violating the ban on cartels or not, call in legal advice to find out if your collaboration agreement complies with these conditions.