• For almost a decade, Scott Sportech Poland has prevented dealers from selling bicycles via the Internet.
• The company infringed both domestic and EU competition laws by virtue of restricting competition among traders.
• This was how it obstructed a capacity to choose better and lower-cost offers for its customers.

Let’s imagine a cyclist who has been searching for an appropriate bicycle for long with the intention to schedule a holiday journey. They wanted to purchase the bike via the Internet - they found a model of a suitable colour and size whose cost was lower than the cost of bikes in the surrounding stores on top of that. In the end, though, they did not finalise the transaction. The reason? The seller had its premises in Gdańsk, while online purchase together with the delivery to the destination specified by the cyclist was not possible. Following the rules imposed by the distributor, that is, Scott Sportech Poland, the purchase had to be made in person, in the traditional store. For a customer from South-East Poland this would mean a necessity to travel more than 600 kilometres, which would turn out to be impractical and costly. In the end, they opted out of the purchase, surely just like some other potential customers in similar circumstances.

Though the situation above is not a real one, the practice mentioned is real indeed. Blocking online sales along with the bike delivery to the place specified by the consumer, for almost a decade, applied to dealers cooperating with Scott Sportech Poland, a distributor of the brands such as: Scott, Bergamont and Bold. The blockade of online trade made that dealers did not have to compete with other traders Poland-wide since, in practice, their activities were limited to the customers from the surroundings. A capacity for competing with the use of price and scope of the offer was significantly limited. What is more, this prohibition was observed not only because of fear from a distributor’s reaction - dealers themselves informed the company of instances of breach, enhancing a prevailing market division scheme this way.

– A prohibition of online sales is not a business strategy, it is a form of closing the market and excluding competition. Consumers have a right to freely choose offers, irrespective of whether they are going to buy a bicycle in a traditional store or via the Internet – says Tomasz Chróstny, the President of UOKiK.

Unfair mechanisms

Scott Sportech Poland relied on the provisions of the so-called “distribution arrangements” and “terms and conditions of cooperation”. Although those documents did not contain any direct prohibition of online sales, they still imposed on dealers the obligation to personally hand in to the customer a fully assembled bike and prohibited from selling via platforms such as Allegro or eBay. The presentation of products on the Internet was permitted, but it had to be limited to the informational role - it was to encourage to a visit to a traditional store rather than provide an opportunity for making online purchase together with the delivery to the place specified by the consumer. In practice, it meant that the transaction had to be finalised at PoS.

An attempt to sell bikes online together with the delivery to the place chosen by the consumer ended up with an intervention of the company - dealers were sent e-mails with a threat of sanctions. As a result, they could not compete with other traders either by virtue of price or availability. What is more, sellers themselves paid attention to observing this prohibition - they watched the activities of others and informed the distributor of any instances of its breach.

In addition, the restriction of online trade resulted in dealers failing to compete for customers online among themselves, which could enhance sustaining higher prices. As a consequence of the company’s operations, consumers lost access to competitive prices and full product offer. The shopping was less convenient, more time-consuming and potentially more costly.

The President of UOKiK concluded that the company had breached the laws - both Polish and EU ones - by way of obstructing competition and obstructing access to the offer for customers. The prohibition of e-sales could have blocked transactions among Polish dealers and customers from other EU states; therefore, the President of UOKiK, by issuing their decision, simultaneously implemented Article 101 of the Treaty on Functioning of the European Union which prohibits any arrangements restricting the trade within the single market.

UOKiK imposed a fine of PLN 4,340,394 on the company. The decision is not final and may be appealed against.

Other activities of the President of UOKiK in the bicycle market

In 2023, the President of UOKiK finalised the proceedings against Merida Polska which had prevented its customers from buying bicycles online. This practice resulted in artificial competition restriction and territory-based market sharing, among traders. As a result of the anti-trust proceedings instigated by the President of UOKiK, a fine of almost PLN 2.5 million was imposed on the company. The Court of Competition and Consumer Protection dismissed the appeal submitted by Merida from this decision, it confirmed this practice but still it reduced the fine by more than PLN 400 thousand. The decision of the Court is not yet legally binding.

Additionally, the President of UOKiK has been recently holding the preliminary investigation on the operations of the Kellys company which is an official importer and distributor in Poland of the products of the Slovakian company Kellys Bicycles. The purpose of the proceedings is to make preliminary findings as to whether the company might have concluded a prohibited competition-restricting agreement with its distributors - entrepreneurs running commercial operations in both traditional and online stores. It was to consist in determination of a price for resale of bikes, bike accessories and sportswear. In the course of the investigation, upon a consent of the Court and assisted by the Police, UOKiK employees made searches in the premises of the company and its three distributors.

The cases of Merida, Scott Sportech Poland and Kellys are a part a more extensive actions of the President of UOKiK whose aim is to eliminate unfair mechanisms restricting access to competitive offers for consumers.

The leniency programme

The maximum fines for participation in an anti-competitive agreement is 10 per cent of turnover for business entity and PLN 2 million for managers. Severe penalties for participation in collusion can be avoided by taking advantage of the leniency scheme. It offers businesses involved in an illegal agreement and managers responsible for entering into a collusion arrangement an opportunity to reduce a sanction or, in some cases, avoid it altogether. It is intended for those who agree to cooperate with the President of UOKiK as a “crown witness” and provide evidence or information regarding the existence of a prohibited agreement. We encourage those interested in the leniency scheme to contact the Office at a dedicated phone number: 22 55 60 555. UOKiK staff will answer any questions about the leniency programme, including anonymous ones.

At the same time, we operate a programme to acquire information from anonymous whistleblowers. Do you wish to inform UOKiK about competition restricting practices? Visit https://uokik.whiblo.pl/ or scan the QR code below and use the simple form. The system we use guarantees complete anonymity, including from UOKiK itself.