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Swiss Federal Administrative Court Brings Rules on Recommended Resale Prices in Line with EU Practice


In December 2009, the Swiss Competition Commission (COMCO) sanctioned three producers of drugs for erectile dysfunction for issuing resale price recommendations. COMCO argued inter alia that the price recommendations amounted to unlawful concerted practices on resale prices because a large number of the pharmacies and doctors involved sold the products at the recommended prices.
COMCO also argued that the price recommendations of the three pharmaceutical companies (Bayer, Pfizer and Eli Lilly) resulted in the continuation of the price and margin levels of a former industry cartel that was prohibited by COMCO in June 2000.
A further element was that wholesalers and a company that offered data bases on pharmaceuticals products transmitted the recommended prices to the pharmacies and doctors. These companies were qualified as facilitators of the unlawful practices.
Many scholars criticised COMCO’s approach because it was in contrast to EU law where price recommendations are only unlawful if they amount to a minimum or fixed sale price as a result of pressure from, or incentives offered by, any of the parties involved. It also led to legal uncertainty as companies in Switzerland feared that the mere fact that a large part of the resellers adhered to the recommended prices could make the recommendations unlawful and subject to severe sanctions.

The decision of the FAC

The three producers, a pharmacy, two wholesalers and the company offering pharmaceutical data bases appealed against the decision. Already in 2013 the Federal Administrative Court (FAC) annulled COMCO’s decision with the reasoning that the Cartel Act is not applicable to the relevant market due to the restrictions contained in the regulatory framework and due to the fact that consumers that suffer from erectile dysfunction have feelings of shame which prevent them from comparing the prices offered by the pharmacies. However, the Supreme Court annulled this decisions and referred the case back to the FAC.
In its second decision on the same matter, the FAC has annulled COMCO’s decision once again. The FAC held:
  • The evidence brought forward by COMCO for the high rate of adherence was not robust enough.
  • The mere fact that a large number of pharmacies and doctors adhered to the price recommendations (without coercion or incentives) did not amount to a concerted practice in terms of Article 4(1) of the Cartel Act.
  • The price recommendations had the function of recommended maximum prices rather than minimum prices and that therefore no restriction of competition was established.
The judgment is to be welcomed as it brings Swiss law into line with international standards. Price recommendations are possible in Switzerland if the principles established under EU law are met.
The decisions are not final and binding yet as the Federal Department of Economic Affairs, Education and Research might appeal against the decisions before the Supreme Court.
Decisions of 19 December 2017: B-842/2015; B-843/2015; B-844/2015; B-845/2015; B-846/2015.
This blog post was first published on Thomson Reuters‘ Practical Law website. It is reproduced from Practical Law with the permission of the publishers. For further information visit or call +44 (0)20 7542 6664.

Swiss Competition Commission adapts the Communication on Vertical Restraints

After the Federal Supreme Court’s landmark decision in the Gaba (Elmex) case, the Swiss Competition Commission (COMCO) has made adjustments to the communication on the treatment of vertical agreements. Additionally, COMCO has for the first time published explanatory notes to assist with the interpretation of the communication on vertical restraints.


The trigger for adapting the Communication was the publication of the Federal Supreme Court’s Gaba (Elmex) judgement at the end of April 2017.
In the surprisingly strict decision the Federal Supreme Court had stated, that both hard-core horizontal agreements (price, quantity and territorial agreements) and hard-core vertical agreements (resale price maintenance and absolute territorial protection) have to be regarded as per se significant. It is enough for such agreements to have the potential to affect competition; COMCO is no longer required to demonstrate evidence of significant and real effects or to show that the agreement has been effectively put into practice.
This new practice applies regardless of quantitative criteria, such as market shares of the companies involved. A company involved in such an agreement can then only escape a sanction if it manages to justify its behaviour on grounds of economic efficiency (which is very difficult according to COMCO’s past practice).

Adaptations made by COMCO

The adaptations to the communication affect individual points only, and their primary purpose is to bring the communication in line with the interventionistic Gaba decision.
However, the communication on vertical restraints makes clear, that in non-hardcore cases that are not caught by one of the presumptions, it is not just the qualitative criteria that have to be assessed but the quantitative ones as well. Therefore, in non-hard-core cases, the authority has to prove significant effects on the relevant market.
Furthermore, the most important characteristics of vertical price agreements and vertical agreements on absolute territorial protection are summed up in the explanatory notes. In addition, the explanatory notes include a summary of the rules governing online commerce
The explanatory notes do also state that the EU’s Guidelines on Vertical Restraints apply in an analogous way to Swiss law.


Although the adaptions made by the COMCO affect individual points only, the newly adopted explanatory notes, which summarize the practice of recent years, are likely to be of considerable importance for companies and competition lawyers in the future.
However, several open questions remain unanswered. For example, the EU Guidelines on Vertical Restraints contain numerous references to franchise systems, whereas the explanatory notes on vertical restraints do not mention this type of vertical agreement at all.
Also, no answer has been provided to the question as to whether in the case of so-called „hard-core agreements“ Swiss law would allow for the existence of a safe harbour in the sense of a de minimis rule.
Unfortunately, the Federal Supreme Court has held that the rules contained in the EU Technology Transfer Block Exemption Regulation are not relevant for the treatment of such agreements under Swiss competition law. So, as far as Swiss law is concerned, doubt still persists as to the extent companies should be guided by EU practice. Nevertheless, the statement in the new explanatory notes that the EU’s Guidelines on Vertical Restraints apply analogously is to be welcomed.
This blog post was first published on Thomson Reuters‘ Practical Law website. It is reproduced from Practical Law with the permission of the publishers. For further information visit or call +44 (0)20 7542 6664.

Swiss Competition Commission blocks proposed merger between Ticketcorner and Starticket

We decided to start publishing blog posts in English language.

On 23 May 2017, the Swiss Competition Commission released a public statement about its prohibition of the merger between Ticketcorner and Starticket.

Although the substantive test of the Swiss merger control regulation sets very high standards for an intervention the Swiss competition authority considered that the proposed merger between the two ticketing companies Starticket and Ticketcorner could lead to an elimination of effective competition on the Swiss ticketing markets. Therefore, the authority has prohibited the concentration. Swiss Competition Commission blocks proposed merger between Ticketcorner and Starticket weiterlesen