Belgian Competition Authority Launches First Sector Inquiry into Price Revision and Indexation Mechanisms

• 07/02/2025
• News

Yesterday, the Belgian Competition Authority (BCA) launched its first sector inquiry and targeted price revision and indexation mechanisms. The BCA had been gearing up for sector inquiries for quite a while (see, VBB Belgian Antitrust Watch of 25 October 2024). Yesterday’s launch therefore came as no surprise even though its focus was unexpected.

The term “sector inquiry” is somewhat of a misnomer because the BCA's investigation will not be limited to a specific industry or line of economic activity but will cover the entire Belgian economy. In its decision to open the investigation, also published yesterday (the Decision), the BCA contended that profit margins increase faster in Belgium than in neighbouring countries and that prices remain high despite a decrease of energy prices. The BCA suspects that the various sectoral price revision and indexation mechanisms prevalent in many sectors of the Belgian economy may contribute to inflation, which the BCA notes is particularly high in Belgium.

In its Decision, the BCA observed that, while a Law of 1976 prohibits indexation based on general price indexes, there are many exceptions to this rule. The BCA cited as examples notary fees and expenses, housing rents, public procurement price indexes, gas and electricity prices, and construction contracts.

In practice, the BCA intends to list the various price revision and indexation mechanisms applied in Belgium and identify those that could be questionable from a competition perspective before issuing “concrete conclusions and recommendations to stakeholders”.

The BCA has several types of problematic situations in its sights. For example, some price increases could result from anticompetitive practices, such as in the VEBIC case. VEBIC is an association of bakeries which, in 2008, was found to have encouraged its members to increase their prices based on a bread price index which VEBIC had calculated and was not linked to actual costs. The BCA also referred to an opinion issued in 2014 by the French Competition Authority (FCA) in which the FCA had found that the exceptional net profitability of highway concessionaires, unrelated to costs or risks taken by them, could be likened to an income derived from the continuous increase in toll rates.

The BCA added that even indexation mechanisms based on cost indexes can lead to excessive price increases, when these increases are too frequent or based on irrelevant cost parameters. The BCA also noted that trade associations may “create conditions conducive to (tacit or explicit) collusion” by facilitating transparency on the market or sharing detailed sensitive information (which may lead to anticompetitive “signalling”). The BCA referred to a 2010 decision in which the institute of real estate agents was found to have infringed the competition rules by issuing minimum recommended rates. It also mentioned a 2016 decision in which the BCA held that producers and distributors of industrial batteries had illegally agreed on a lead surcharge.

The BCA expects its investigation to last 13 months, including at least two months of public consultation, and to be completed early 2026.