The EU Competition Law Treatment of Market Allocation

Market allocation, also known as market sharing, is a type of collusive practice in which companies agree to divide up a market among themselves, rather than competing for customers. This is considered a serious violation of EU competition law because it limits competition and can lead to higher prices for consumers.

The EU Commission has the power to investigate and impose fines on companies engaged in market allocation. The fines for market allocation can be substantial, up to 10% of a company's worldwide annual revenue for each year it participated in the cartel. National competition authorities also have the power to investigate and impose fines on companies engaged in market allocation within their respective countries.

Examples of market allocation include agreements between companies to divide up customers, territory, or product lines. The EU Commission actively monitors and investigates potential market allocation activities in different sectors. Companies and individuals can also report any information they may have on possible market allocation activities through the commission's leniency program, which offers reduced fines for companies that come forward and provide evidence of cartel activities.