This assignment will give an overview on competition policy on the example of the German beer market. This includes the definition of how a price is determined and what the characteristics of a competitive market are. The German beer market will be described as an example of a competitive market. Subsequently the case “Bußgelder gegen Brauereien B10-105/11” investigated by the Bundeskartellamt in 2014 will give a practical example for price agreements.
Competition is a phenomenon in the economy. It is characterized by the existence of markets and at least two suppliers and buyers in competition with each other. The advantageous features of the price mechanism in a competitive market only arise if there is competition between suppliers. Competition does not necessarily exist of its own accord. The core business objective of companies is to generate profits. The less competition there is in the market, the easier this goal can be achieved.
The beer market in Germany is chosen as the example for a competitive market because numerous suppliers offer their products to numerous customers. Last year the number of breweries grew to 1,548 in total. While 20 years ago the number of breweries was 1,281 (1999), it has increased by 267 businesses in the last two decades.With total beer sales of 92 million hectolitres - excluding nonalcoholic beers - Germany continues to be the largest producer of beer in Europe.
Table of Contents
1 Introduction
2 Definition
2.1 Determination of a price
2.2 Characteristics of competitive markets
2.3 Analysis of the German beer market
2.4 Bundeskartellamt
3 “Bußgelder gegen Brauereien B10-105/11”
4 Conclusion
Objectives and Topics
This paper examines competition policy using the German beer market as a practical case study. It explores the theoretical foundations of market pricing and competitive structures, analyzes the current state of the German beer sector, and details the 2014 regulatory intervention by the Bundeskartellamt regarding illegal price-fixing agreements among major breweries.
- Fundamentals of price determination and competitive market theory
- Economic characteristics and trends of the German beer market
- Role and function of the Bundeskartellamt in competition law enforcement
- Case analysis of the 2014 cartel proceedings against German breweries
- Impact of leniency programs on the detection of illegal cartels
Excerpt from the Book
3 “Bußgelder gegen Brauereien B10-105/11”
On 27th December 2013 and 31st March 2014, the Bundeskartellamt imposed fines totalling around 338 million euros on 11 companies, one association and 14 persons with personal responsibility for illegal price agreements for beer.
The companies and the association involved in the case were the following:
- Bitburger Braugruppe GmbH
- Carlsberg Deutschland GmbH
- Krombacher Brauerei Bernhard Schadeberg GmbH & Co. KG
- Radeberger Gruppe KG
- C. & A. Veltins GmbH & Co. KG
- Warsteiner Brauerei Haus Cramer KG
- Privat-Brauerei Ernst Barre GmbH
- Privat-Brauerei Bolten GmbH & Co. K
- Erzquell Brauerei Bielstein Haas & Co. KG
- Cölner Hofbräu P. Josef Früh KG
- Privat-Brauerei Gaffel Becker & Co. OHG
- Verband Rheinisch-Westfälischer Brauereien e. V.
- Brauereikonzern Anheuser-Busch InBev
Summary of Chapters
1 Introduction: This chapter introduces the significance of competition as a cornerstone of economic order and outlines the scope of the study regarding the German beer market.
2 Definition: This section establishes the theoretical framework for price determination, competitive market characteristics, and the institutional role of the Bundeskartellamt.
3 “Bußgelder gegen Brauereien B10-105/11”: This chapter details the specific 2014 cartel case, listing the involved entities and explaining the mechanism of the price-fixing agreements uncovered by the authorities.
4 Conclusion: The final section reflects on the effectiveness of cartel prosecution and discusses the long-term impact of regulatory interventions on consumer prices and market fairness.
Keywords
Competition policy, German beer market, Bundeskartellamt, price determination, market equilibrium, cartel, price-fixing, leniency programme, antitrust law, market competition, oligopoly, economic regulation, brewery industry, consumer protection, competition law.
Frequently Asked Questions
What is the primary focus of this paper?
The paper provides an overview of competition policy, specifically focusing on the German beer market and the regulatory actions taken against price-fixing agreements.
What are the central thematic fields covered in this study?
The work covers economic theory concerning competitive markets, the structure of the German beer industry, and the enforcement activities of the Federal Cartel Office (Bundeskartellamt).
What is the main research objective?
The objective is to explain how competitive markets function and to use a concrete case study to demonstrate how competition authorities intervene when market rules are violated.
Which scientific method is applied here?
The study utilizes a descriptive and analytical approach, combining economic theory with a detailed case study analysis of the 2014 Bundeskartellamt investigation.
What topics are addressed in the main body?
The main body defines price determination, outlines the characteristics of competitive markets, provides an analysis of the beer industry in Germany, and dissects the legal proceedings against major breweries.
Which keywords best characterize this work?
Key terms include competition policy, Bundeskartellamt, price-fixing, cartel, beer market, antitrust, and economic regulation.
What was the outcome of the 2014 cartel case?
The Bundeskartellamt imposed approximately 338 million euros in fines on 11 companies, an association, and 14 individuals for illegal price agreements.
Why is the "Bonus Programm" significant for the authorities?
The leniency program is crucial because it encourages cartel members to disclose internal information, which helps the authority uncover and prove illegal agreements that are otherwise hidden.
How does the author evaluate the impact of the cartel dismantling on consumer prices?
The author concludes that despite the dismantling of the cartel, consumer prices did not normalize to a lower equilibrium, suggesting that consumers remain negatively impacted.
- Quote paper
- Samantha Kim Schönhaber (Author), 2020, Competition Policy. The Case of the German Beer Market, Munich, GRIN Verlag, https://www.grin.com/document/919352
