Can I request that my supplier only sells to me and not to my competitors?
July 11, 2023 | 30,00 EUR | answered by Greta Kleine
Dear lawyer,
My name is Marie Wunderlich and I have been successfully running a business in the furniture industry for several years. My supplier, with whom I have always been very satisfied, is now selling his products to my direct competitors as well. This has put my competitiveness at risk, as my competitors now have access to the same products and may be able to offer them at more competitive prices.
I am very concerned about my future in the market and wonder if it is legally possible to demand from my supplier to only sell to me and not to my competitors anymore. I fear that my sales could drastically decrease if my competitors have access to the same products.
Could you please provide me with information on whether I can take legal action against my supplier to secure exclusivity in sales? Are there possible solutions or legal steps that I could take to protect my interests and strengthen my competitive position?
Thank you in advance for your support and I look forward to your expert advice on this matter.
Sincerely,
Marie Wunderlich
Dear Ms. Wunderlich,
Thank you for your inquiry regarding your competition issues with your supplier. As a competition law attorney, I can understand that the situation is very stressful for you and that you are worried about the future of your business.
Indeed, there are regulations in German competition law that could help you in such a situation. One option to address your supplier would be to claim so-called exclusivity rights. Exclusivity rights are agreements between suppliers and retailers that allow the retailer to exclusively distribute the supplier's products, meaning to only supply to that one retailer and not to competitors.
It is possible to enter into such an exclusivity agreement with your supplier. However, certain conditions must be met. Firstly, such an agreement must be voluntarily entered into between you and your supplier. Coercion or pressure on the supplier would violate competition law. Secondly, the exclusivity rights must be justified based on specific marketing activities or investments that you have made for the distribution of the products.
If your supplier is unwilling to enter into an exclusivity agreement with you, you could also consider whether your supplier may be engaging in an abusive dominance by selling products to your direct competitors, thus weakening your competitive position. In such a case, you could turn to competition authorities and file a complaint.
It is important that you seek legal advice in a timely manner regarding this matter in order to protect your interests to the best of your ability. I am available for further questions and detailed advice in my online consultation hours.
Best regards,
Greta Kleine
Competition Law Attorney
