The Market Court imposed a penalty fee of EUR 1.75 million on Isojoen Konehalli Oy for imposing retailer prices in online stores

On 11 August 2022, the Market Court imposed a penalty fee of EUR 1.75 million on the import and hardware store Isojoen Konehalli Oy (IKH) for prohibited resale price maintenance (RPM). RPM is one of hardcore restrictions on competition, as it prevents price competition between retailers.

In May 2020, the Finnish Competition and Consumer Authority (FCCA) proposed to the Market Court that a penalty fee of EUR 9 million be imposed on IKH for prohibited RPM. The FCCA’s investigations indicate that IKH recommended resale prices for its products and put pressure on its resellers in different ways to comply with them. The FCCA considered that RPM concerned the sale of IKH products in retailers’ online stores and brick-and-mortar stores.

The Market Court considered that IKH, contrary to competition legislation, has imposed retail prices for its retailers in their online stores from March 2010 to February 2015. In addition, IKH agreed with its authorised retailers on fixed resale prices to be applied on the chain’s joint online store from 2014 to 2020, when the FCCA decided to prohibit the procedure.

“We are pleased that the Market Court has recognised the systematic nature of IKH’s activities and the detrimental effect on price competition between retailers. E-commerce is an effective tool for price competition, which is why RPM in e-commerce is particularly harmful,” says Head of Competition Division Timo Mattila.

The Market Court considered that it was not proved in a sufficiently reliable manner that IKH would have required its retailers to comply with the retail price level for the sales of IKH products in brick-and-mortar stores.

The FCCA will examine the decision of the Market Court in more detail and then decide whether to appeal the decision to the Supreme Administrative Court.

More information 

Jarno Sukanen

Director, Head of Department

Annastina Kolehmainen

Senior Adviser

    • RPM refers to agreements and practices between a higher and lower level of sales – for example importer and retailer or manufacturer and importer – with the purpose of achieving a fixed or minimum price level.
      Fixed prices between different levels of sales are almost always prohibited and harmful, as they artificially raise prices to the detriment of consumers.
      RPM does not require a written agreement between the supplier and the retailer.
      RPM also includes influencing resale prices indirectly, for example by encouraging or pressuring others to comply with a certain price.
      Instead of pressuring and encouraging, RPM may also arise from an understanding between a higher and lower sales level. RPM is prohibited regardless of which level takes the initiative to agree on prices.