Is it allowed to offer products below the sales price of the competition?
January 31, 2022 | 45,00 EUR | answered by Sandra Bittner
Dear competition law attorney,
I am contacting you as the managing director of a small retail company, as I am currently facing a legal question. We sell various products in our online shop and have noticed that some of our competitors offer products at a significantly lower price than we do. Now we are wondering whether it is allowed to offer products below the selling price of our competitors in order to remain competitive.
Currently, we feel pressured by the lower prices of our competitors and do not want to fall behind. At the same time, we are unsure whether it is legally permissible to offer products below the selling price of our competitors, as we do not want to risk receiving warnings or legal consequences.
Our concern is that we may be violating competition law by offering products below the selling price of our competitors. Therefore, we urgently need legal advice to ensure that we are acting in accordance with legal regulations.
Could you please provide us with information on whether it is allowed to offer products below the selling price of our competitors? If this is not permissible, what alternatives are available to us to remain competitive? We are very grateful for your help and support.
Best regards,
Gerd Lindenberg
Dear Mr. Lindenberg,
Thank you for your inquiry regarding selling products at a lower price than your competitors. As a lawyer specializing in competition law, I can provide you with the following information:
In general, it is allowed to offer products below the selling price of your competitors, as long as this is not considered as "dumping." Dumping occurs when a company offers its products at a price so low that it could distort the market and unfairly influence competition. In this case, a violation of competition law could be present.
To determine if your behavior could be considered as dumping, a thorough examination of market conditions and the pricing of your competitors would need to be conducted. It is important to note that not every price competition is automatically deemed inadmissible. As long as you adjust your prices strategically to remain competitive and not with the intention of dominating the market, it is generally permissible.
However, there are also alternatives to remain competitive without offering products below the selling price of your competitors. For example, you could focus on other factors such as quality of service, customer loyalty, or the uniqueness of your products. Additionally, you could also use targeted marketing strategies to reach your target audience and convince them of your offer.
I recommend that you schedule a personal consultation with me or another specialized lawyer in competition law to receive detailed information about your situation. Together, we can analyze your individual circumstances and develop solutions to ensure that you act in accordance with legal provisions.
I hope this information is helpful to you and I am available for any further questions.
Best regards,
Sandra Bittner
Lawyer specializing in competition law
