From the Enforcer: Federal Cartel Office
Germany: from the enforcer
Please use this picture of Mr. Mundt
Tel: +49 228 9499 202 / 203
Fax: +49 228 9499 140
Tel: +49 228 9499 205
Fax: +49 228 9499 140
Head of General Policy Division
Tel: +49 228 9499 210
Fax: +49 228 9499 143
Head of Litigation and
Tel: +49 228 9499 216
Fax: +49 228 9499 143
Head of Administration Division
Tel: +49 228 9499 300
Fax: +49 228 9499 146
Chair of 1st Decision Division (Extraction of ore and other non-metallic minerals, building materials, construction industry and related services, real estate and related services, wood industry and furniture, wholesale and retails trade in food, agricultural trade)
Tel: +49 228 9499 410
Fax: +49 228 9499 142
Chair of 2nd Decision Division (E-commerce, agriculture, food and food industry, clothing and shoes, cosmetics and drugstore products, household appliances and consumer electronics)
Tel: +49 288 9499 529
Fax: +49 288 9499 166
Chair of 3rd Decision Division
(Health sector, chemical industry)
Tel: +49 228 9499 413
Fax: +49 228 9499 142
Chair of 4th Decision Division (Waste management industry, automotive industry and other services)
Tel: +49 228 9499 526
Fax: +49 228 9499 154
Chair of 5th Decision Division (Mechanical and plant engineering, metal industry, iron and steel, measurement and control technology, patents and licences, paper industry, gambling industry)
Tel: +49 228 9499 448
Fax: +49 228 9499 149
Chair of 6th Decision Division (Media, internet economy, advertising industry)
Tel: +49 228 9499 491
Fax: +49 228 9499 170
Chair of 7th Decision Division (Telecommunications, broadcast engineering and EDP)
Tel: +49 228 9499 596
Fax: +49 228 9499 167
Chair of 8th Decision Division (Mineral oil, mining, electricity and gas, district heating, water, electrical engineering, Working Group Energy Monitoring, Working Group Market Transparency Unit Electricity/Gas, Market Transparency Unit for Fuels)
Tel: +49 228 9499 482
Fax: +49 228 9499 164
Chair of 9th Decision Division (Tourism and Horeca sector, transport, postal services, financial services, insurance)
Tel: +49 228 9499 436
Fax: +49 228 9499 166
Chair of 10th Decision Division (Prosecution of hardcore cartels)
Tel: +49 228 9499 392
Fax: +49 228 9499 149
Chair of 11th Decision Division (Prosecution of hardcore cartels)
Tel: +49 228 9499 439
Fax: +49 228 9499 149
Chair of 12th Decision Division (Prosecution of hardcore cartels)
Tel: +49 228 9499 443
Fax: +49 228 9499 136
Chair of Decision Division Competition Protection and Consumer Protection (Consumer protection, press and press related advertising industry, book publishing and retail, radio, culture, sport, entertainment, outdoor advertising, trade fairs)
Tel: +49 228 9499 2190
Fax: +49 228 9499 2192
Chair of 1st Public Procurement Tribunal
Tel: +49 228 9499 547
Fax: +49 228 9499 163
Chair of 2nd Public Procurement Tribunal
Tel: +49 228 9499 542
Fax: +49 228 9499 163
Competition Register for Public Procurement
Tel: +44 228 9499 559
Fax: +44 228 9499 146
Tel: +49 228 9499 457
Fax: +49 228 9499 143
Tel: +44 228 9499 215
Fax: +44 228 9499 143
The Federal Cartel Office (FCO), known in German as the Bundeskartellamt, cooperates closely with other competition authorities in Europe and worldwide. Andreas Mundt has been chairman of the International Competition Network (ICN) since 2013. He is also a long-standing member of the Bureau of the Organisation for Economic Co-operation and Development (OECD) Competition Committee. At the European level, the FCO is very active in the European Competition Network. Notably with regard to the exchange of information, as well as mutual assistance in cartel investigations, the European Competition Network (ECN) has significantly enhanced cooperation with the European Commission and among national competition authorities. Furthermore, the FCO is actively involved in the work of international organisations such as the OECD, United Nations Conference on Trade and Development and World Trade Organization.
Other competition bodies
While the FCO has exclusive jurisdiction over mergers, the competition authorities of the various states are competent in cases where the restrictive effect of a cartel or abusive practice is limited to a single state. In addition, the Federal Network Agency has certain competition powers but is primarily responsible for safeguarding non-discriminatory access to essential facilities in the electricity, gas, telecommunications, postal services and railway sectors. Finally, in very exceptional circumstances, and after a thorough procedure that ensures public scrutiny and political accountability, the Federal Minister for Economic Affairs and Energy may authorise mergers that have been blocked by the FCO on grounds of public interest.
Questions and answers
How long is the head of agency’s term of office?
The president of the FCO is appointed by the federal government for an indefinite period of time.
When is he or she due for reappointment?
Andreas Mundt has been the president of the FCO since 2009.
Which posts within the organisation are political appointments?
There are no political appointments within the FCO. Case handlers and senior staff members are lifetime civil servants.
What is the agency’s annual budget?
The annual budget for 2021 is €43.5 million.
How many staff are employed by the agency?
In 2020, around 400 people were employed by the FCO.
To whom does the head of the agency report?
The FCO is an independent higher federal authority assigned to the Federal Ministry for Economic Affairs and Energy. It is independent in its decision-making and applies solely competition criteria. The FCO reports biennially to the German parliament on its activities.
Do any industry-specific regulators have competition powers?
On the basis of sector-specific laws, the Federal Network Agency for Electricity, Gas, Telecommunications, Post and Railway is responsible for sector-specific regulation. However, general competition law remains applicable and is enforced by the FCO insofar as the relevant markets are competitively organised, such as electricity generation.
If so, how do these relate to your agency’s role?
The FCO liaises with the Federal Network Agency in matters of market definition and market position. Nevertheless, the German Act against Restraints of Competition (German Competition Act), as well as European competition law, are applied exclusively by the FCO.
May politicians overrule or disregard the authority’s decisions? If they have ever exercised this right, describe the most recent example.
There is no possibility to overrule the decisions of the FCO, with one exception: the ‘ministerial authorisation’ in merger cases. The Federal Minister for Economic Affairs and Energy may overrule the decision of the FCO to block a transaction and authorise a merger if the negative effects on competition identified by the FCO are outweighed by positive effects on the economy as a whole or the concentration is justified by an overriding public interest. The exception is applied very restrictively, and since the introduction of merger control in 1973, only ten concentrations have been approved – seven of them subject to conditions – by ministerial authorisation. The most recent example is the formation of a joint venture between Miba AG and Zollern GmbH & Co KG in the plain bearings segment. After the FCO prohibited the joint venture in January 2019, the parties applied to the Federal Ministry for Economic Affairs and Energy for ministerial authorisation. In a special opinion commissioned by the Ministry for Economic Affairs and Energy, the Monopolies Commission recommended against the issue of a ministerial authorisation. However, the Ministry granted the authorisation subject to conditions, holding that the merger was significant for achieving the energy transition and environmental objectives associated with it, which would mean that there was an overriding public interest to authorise the merger.
Does the law allow non-competition aims to be considered when your agency makes decisions?
The German Competition Act does not provide for non-competition aims to be considered by the FCO in its decision-making process. The sole exception is the ministerial authorisation procedure mentioned above.
Which body hears appeals against the agency’s decisions? Is there any form of judicial review beyond that mentioned above? If so, which body conducts this? Has any competition decision by the agency been overturned?
Appeals against decisions of the FCO are heard by specialised competition divisions at the Court of First Instance (Düsseldorf Higher Regional Court). Decisions of the Düsseldorf Higher Regional Court can be appealed to the Federal Court of Justice on grounds of law. During the past few years, the FCO’s decisions have only been overturned in a few cases.
Has the authority ever blocked a proposed merger?
Since the introduction of merger control in Germany in 1973, more than 200 mergers have been prohibited or cleared subject to conditions or obligations. Moreover, many merger projects are terminated or modified following a preliminary examination or pre-notification contacts with the FCO.
Has the authority ever imposed conditions on a proposed merger? If yes, please provide the most recent instances.
Mergers that raise competition concerns are cleared subject to conditions or obligations if the parties propose suitable commitments that are sufficient to remove the competition problems.
The last case in which the FCO imposed conditions concerned the retailer Edeka’s plans to acquire up to 72 Real stores from SCP Retail Sàrl. 21 stores cannot be acquired because of the FCO’s competition concerns. In the case of six other stores, carved-out retail space has to be given up to competitors or other Edeka stores in the market area have to be closed. Another case concerned the merger between the two cinema chains CinemaxX and Cinestar. The FCO cleared the merger subject to the merger parties selling six of their cinemas to other operators first. Ultimately, the parties did not implement the merger.
Has the authority conducted a Phase II investigation in any of its merger filings? If yes, please provide the most recent instances.
The FCO examines more than 1,000 merger filings each year. Usually, in 10 to 20 of these cases, the FCO initiates Phase II investigations. In 2020, 1,230 merger filings were notified to the FCO, nine of which were examined in Phase II proceedings.
Recent examples include:
- Funke Mediengruppe/‘Ostthüringer Zeitung’ (Newspapers and publishers) (prohibition);
- Rohrdorfer/Ganser (Ready-mixed concrete) (clearance); and
- Spreewaldhof/Andros (Preserved fruit in glass jars and cartons) (clearance)
Has the authority ever pursued a company based outside your jurisdiction for a cartel offence? If yes, please provide the most recent instances.
The FCO can pursue all restraints of competition having an effect in Germany, even if they were caused abroad. In this context, the domicile of a company is irrelevant.
Do you operate an immunity and a leniency programme? Whom should potential applicants contact? What discounts are available to companies that cooperate with cartel investigations?
The leniency programme of the FCO, as well as guidance on the setting of fines, is published on the website of the FCO at www.bundeskartellamt.de. Potential applicants should contact the FCO’s Special Unit for Combating Cartels (SKK) at +49 228 9499 386 for further information.
The FCO can grant cartel participants, who by their cooperation contribute to uncovering a cartel, immunity from or a reduction of fines. The fine to be imposed on a cartel participant is waived if he or she is the first to contact the FCO to uncover the cartel and fully cooperates with the authority. Immunity from fines can also be granted after proceedings have been initiated if the FCO is provided with decisive evidence without which the existence of a cartel could not have been proved. The ringleader of the cartel and cartel members who coerced others to participate in the cartel cannot be granted immunity from fines.
The fine can be reduced by up to 50 per cent for all other leniency applicants depending on the value of their contributions to proving the offence. In this respect, it is also important to consider at which stage the application for leniency has been made and whether the applicant has contacted the FCO faster than other cartel members.
Is there a criminal enforcement track? If so, who is responsible for it? Does the authority conduct criminal investigations and prosecutions for cartel activity? If not, is there another authority in the country that does?
German competition law only provides for administrative fines for both undertakings and managers, but no criminal sanctions. One exception exists for bid-rigging cases: bid-rigging may be punished by up to five years of imprisonment. The prosecution of bid-rigging is divided between the FCO (fines for undertakings) and the public prosecutor (criminal enforcement concerning individuals).
Are there any plans to reform the competition law?
As far as the FCO knows, at the moment there are no plans for a reform.
When did the last review of the law occur?
The 10th Amendment to the German Competition Act (GWB) was enacted on 19 January 2021. This amendment was triggered by, among other factors, the obligation to transpose the Directive to empower the competition authorities of the member states to be more effective enforcers (known as the ECN+ Directive) into German law by 4 February 2021. However, the amendment also modernises the law on the abuse of market power and allows the Bundeskartellamt to better address the challenges posed by the digital economy.
The amendment also provides for changes in the area of merger thresholds and procedure and strengthens the possibilities of undertakings to receive guidance from the competition authority. A key focus of the amendment lies on modernising the law on the abuse of market power and on better addressing the challenges posed by the digital economy. The objective is to offer more effective tools to tackle anticompetitive practices by large platform companies. Most significantly, it provides a new provision applicable to undertakings that are of ‘paramount significance for competition across markets’. This provision would enable the FCO to issue a decision stipulating that a company is of such significance. On this basis, the FCO would then be able to prohibit certain kinds of behaviour, such as self-preferencing, envelopment strategies and establishing barriers to market entry through the use of data, hindering interoperability or data portability even in markets where the respective company has not (yet) reached a dominant position.Do you have a separate economics team? If so please give details.
The FCO maintains a specialised economics unit, under the leadership of the chief economist. The tasks range from conceptual issues to data management and quantitative analyses. The economics unit supports and advises the Decision Divisions regarding case-specific issues and general economic questions.
Has the authority conducted a dawn raid?
Every year, the FCO receives new indications of cartel cases and follows these up in dawn raids. In 2020, due to the covid-19 pandemic, the Bundeskartellamt temporarily paused dawn raids due to urgent public health concerns and set up a comprehensive corona protection concept. After establishing sufficient pandemic safety measures, the Bundeskartellamt successfully carried out a dawn raid at several locations in Germany in the late summer of 2020 with the help of the criminal investigation departments and public prosecutors.
Has the authority imposed penalties on officers or directors of companies for offences committed by the company? If yes, please provide the most recent instances.
The FCO imposes fines on companies and the responsible officers, who often are directors. In 2020, the FCO imposed fines of around €349 million on a total of 19 companies and 24 individuals. The sectors concerned included plant protection products, aluminium forging companies, musical instruments and vehicle registration plates.
What are the pre-merger notification thresholds, if any, for the buyer and seller involved in a merger?
A merger is subject to control where in the last business year preceding the concentration the combined aggregate worldwide turnover of all participating companies was more than €500 million. At least one of the companies must have a turnover of more than €50 million and another of more than €17.5 million in Germany.
In addition, there are legal exemptions for companies whose size is considered to be of minor importance from a macroeconomic view. This is the case if one of the companies had an annual worldwide turnover of less than €10 million in the last business year preceding the concentration.
With the amendment to the GWB in 2017 a new transaction value threshold (purchase price criterion) amounting to €400 million was introduced into German competition law because the existing turnover thresholds turned out to be insufficient to cover all relevant mergers and acquisitions in the digital economy and other innovative sectors. Sometimes high purchase prices are paid for companies which up to now have achieved little or hardly any turnover but are of great potential value.
The 10th Amendment to the German Competition Act, which entered into force in January 2021, introduced the possibility to oblige powerful companies to notify mergers with smaller target companies in a defined economic sector whose turnover in Germany is less than €17.5 million. This obligation is subject to a number of conditions: the powerful company must achieve a worldwide turnover of €500 million and have at least a 15 per cent share of an economic sector that has previously been examined by the Bundeskartellamt in the context of a sector inquiry. The target must have a turnover of more than 2 million, of which at least two-thirds must have been domestic turnover. In addition, there must be indications suggesting that future mergers are likely to impede effective competition. The obligation is valid for three years.
Are there any restrictions on investments that involve less than a majority stake in the business?
Along with mergers in the stricter sense and majority holdings, in some cases, the acquisition of a minority interest can also qualify as a concentration within the meaning of the GWB. This is the case, for example, if at least 25 per cent of the voting rights or capital shares of another company are acquired. Minority participations must also be notified if they enable the acquiring company to exercise a material influence on the other company. The acquisition of significant assets, such as a production site or a business division, can also constitute a concentration within the meaning of the law.
Germany: from the enforcer's competition economists
Address: Bundeskartellamt, Kaiser-Friedrich-Strasse 16, 53113 Bonn, Germany
Tel: +49 228 9499 427
Fax: +49 228 9499 143
Email: [email protected]
Questions and answers
How many economists do you employ?
As of August 2021, the Federal Cartel Office employs 58 economists (including business economics). The majority of them work as case handlers in the Decision Divisions.
Do you have a separate economics unit, or ‘bureau’?
Yes, the Federal Cartel Office maintains a specialised economics unit, under the leadership of the chief economist. The tasks range from conceptual issues to data management and quantitative analyses. As of August 2021, the unit comprises eight staff members.
Do you have a chief economist?
Yes, the position is held by Marcel Balz.
To whom does the chief economist report?
The chief economist supports the Decision Divisions in economic matters, is responsible for internal trainings on specific economic issues and maintains contact with academia and economic consultancies. He reports to the head of the Policy Division and may also directly advise the president and vice president on any economic issue.
Does the chief economist have the power to hire his or her staff?
The chief economist is involved in the recruitment process for economists by the Federal Cartel Office but does not have the power to hire permanent staff on its own responsibility.
How many of your economists have PhDs in industrial organisation?
Of the 58 economists employed by the Federal Cartel Office, 25 hold a PhD. Most of them dealt with topics regarding industrial organisation and competition economics in their PhD studies.
Does the agency include a specialist economist on every case team? If not, why?
Formally, there is no mandatory involvement of a specialised economist in every case. However, a specialist economist is actually included in almost every case team. In addition, the economics unit advises the Decision Divisions in all complex cases, such as Phase II mergers or sector inquiries. It is also regularly involved when economic expert reports are submitted by parties.
Is the economics unit a ‘second pair of eyes’ during cases – is it one of the agency’s ‘checks and balances’? If not, why not?
The economics unit supports and advises the Decision Divisions regarding case-specific issues and general economic questions. The economics unit can thus also be viewed as one of the agency’s checks and balances, even if this is not its key function. Furthermore, as a significant part of the Federal Cartel Office staff are trained economists and decisions are taken in boards of three officials, usually at least one economist votes in each case.
How much economics work is outsourced? What type of work is outsourced?
Owing to the existence of a specialised economics unit and the considerable number of economists among the staff, the Federal Cartel Office can ordinarily deal with economic issues internally. External economists are called in only as an exception. At the same time, however, the economics unit maintains close contact with academia and economic consultants. For example, the Federal Cartel Office established a ‘Working Group on Competition Economics’ in 2017. At regular meetings of this working group, Federal Cartel Office staff members and economic researchers discuss theoretical and empirical concepts used in the authority’s case practice.