Global: EU Authorities Ramp Up Enforcement Against Anti-Competitive Practices

European regulators have intensified their scrutiny of anti-competitive conduct within consumer product companies, signaling a robust crackdown on potential violations.

According to the Financial Times (FT) report on Sunday (Feb. 18), competition authorities conducted 26 surprise inspections on consumer companies across the U.K., Switzerland, and the European Union last year. This marked an increase from 17 inspections conducted in 2022, highlighting heightened vigilance in monitoring market dynamics.

Citing data from law firm White & Case, the report underscores competition lawyers’ observations that rising inflation may incentivize companies to engage in collusion or conceal price hikes. Zoe Mernick-Levene, head of competition at Leigh Day, noted that inflationary pressures could facilitate the concealment of price increases, prompting regulators to scrutinize the balance of power between consumers and firms more closely.

Several prominent companies, including Red Bull, Michelin, and Kering (owner of Gucci), were among those subjected to surprise inspections for suspected antitrust law violations, the report revealed. PYMNTS has reached out to these companies for comments but has yet to receive a response.

Amidst what the FT describes as the worst cost-of-living crisis in a generation, exacerbated by global events such as Russia’s invasion of Ukraine and the easing of COVID lockdowns, European consumers are facing escalating prices for goods. While lower energy prices have mitigated overall inflation, the cost of goods continues to rise, contributing to a surge in retail sales values.

According to the report, retail sales in the consumer products sector witnessed an average 10% increase globally last year, with 75% of this growth attributed to price hikes. Notably, 95% of sales growth in the U.S. and Europe stemmed from price increases.

While consumers’ sentiment toward retail prices appears to be improving, retail sales data presents a mixed picture. January witnessed a 0.8% decline in retail sales, falling short of consensus expectations, reflecting ongoing challenges in the retail landscape.