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Bundeskartellamt clears Intersport’s online platform sales model

Christian Fernsby ▼ | July 2, 2020
The Bundeskartellamt has examined Intersport’s online platform sales model and has no objections under competition law.
Andreas Mundt
Bundeskartellamt   Andreas Mundt
Based on the available information the Bundeskartellamt sees no need for an in-depth examination.

Topics: Bundeskartellamt Intersport

Andreas Mundt, President of the Bundeskartellamt: “It is especially difficult for smaller retailers to compete alone against major online retailers like Amazon and the manufacturers’ online shops. The individual Intersport retailers in Germany face strong competitors, both in the brick-and-mortar business and online.

"The shared online platform under the Intersport umbrella brand is an attractive sales alternative for the retailers, which are mostly active in the brick-and-mortar business. It strengthens competition in the sports retail business and provides more choice for consumers online.”

Intersport is the world’s largest association of medium-sized companies in the sports retail sector. More than 900 members run approximately 1,500 sports retail outlets in Germany. Within the Intersport organisation Intersport Digital GmbH (“IDG”) operates the online sales platform for associated retailers in Germany.

The platform switched to a drop shipping model in January 2019, meaning that the IDG platform determines the prices and sells the products to end customers. There is no direct contractual relation between the Intersport retailers and end customers. However, the individual retailers can determine a price for which they are prepared to sell a particular product to IDG.

IDG then forwards orders based on an internal distribution plan to one or more retailers for order processing and delivery. IDG selects retailers depending on their delivery capacities and geographical proximity to the respective customers. As soon as a customer places an order via the online shop, a contract between IDG and the retailer is concluded.

The shared platform affects competition between the retailers only to a minimal extent. The associated Intersport retailers sell only a small percentage of their products via the online platform. They are mostly active in the brick-and-mortar business and, without restrictions, they are free to operate their own online business via third-party platforms or their own homepages at prices they determine while being a platform member.

However, it would be very difficult for a large number of Intersport retailers, especially for the smaller ones, to operate a sustainable online business themselves. Individual retailers also find it difficult to compete with the online shops offered by large online retailers or manufacturers. Using the shared platform for them is an opportunity to operate an online business. The Intersport platform thus strengthens competition in sports retailing.

The Bundeskartellamt has made it clear to IDG that non-discriminatory access to the platform must be available to all Intersport retailers fulfilling the access criteria. The access criteria must be available to all retailers and they must not discriminate against smaller retailers generating less turnover.


 

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