Belgian Competition Authority Welcomes FMCG Price Trends but Warns About Territorial Supply Constraints

• 26/01/2024
• News

The Belgian Competition Authority (BCA) published on 25 January 2024 a report analysing pricing trends in the fast-moving consumer goods industry in Belgium compared to pricing developments in France, Germany and the Netherlands.

The report is based on “Euromonitor Passport” data from 2013 to 2022 in eight categories: (i) alcoholic drinks, (ii) soft drinks; (iii) hot drinks; (iv) staple food (such as pasta, rice and canned food); (v) dairy products and substitutes; (vi) snacks; (vii) cooking ingredients and meals; and (viii) beauty and personal care products.

Belgian consumer prices are higher but evolve more favourably than in neighbouring countries

The BCA found that average retail prices are overall higher in Belgium than in Germany and the Netherlands. The report offers a mixed picture for France, which has higher average prices in five categories (alcoholic drinks; hot drinks; staple food; snacks; and beauty and personal care) and lower average prices in the remaining three categories (soft drinks; dairy products and substitutes; and cooking ingredients and meals).

Importantly, the BCA notes that the price trends are more favourable to Belgian consumers than to their Dutch, French, and German counterparts: for almost all categories analysed, the average consumer prices have been decreasing faster (or increasing less rapidly) in Belgium between 2018 and 2022.

BCA takes issue with supplier prices, especially in the beverage sector

Conversely, the BCA appears to consider supplier prices to be problematic. The BCA notes that these prices generally represent a lower share of consumer prices in the Netherlands than in Belgium, and that the positive price trend observed in Belgium is explained “at least in part, by the recent increase in competition in the Belgian retail sector”.

The BCA’s concerns seem to focus on the beverage industry. The BCA notes that the share of supplier (or manufacturer) selling prices (MSP) in retailer selling prices (RSP) for alcoholic and soft drinks is “substantially lower” in Germany than in Belgium, while it is generally the opposite (or equivalent) in other industries. The share of MSPs in RSPs are also lower for alcoholic and soft drinks in France, albeit to a lesser extent.

Share of MSP in RSP by industry in 2022 (source: Belgian Competition Authority)



The BCA states that “for the alcoholic and soft drinks industries, the differences in average manufacturer selling prices (MSP) are more pronounced than differences in retailer selling prices (RSP) to the disadvantage of Belgium compared to all three neighbouring countries.” The findings regarding other industries are less straightforward.

Increasing focus on territorial supply constraints in the Benelux and France

Based on these results, the BCA considers that territorial supply constraints (TSCs) should be investigated, in particular in the alcoholic and soft drinks industries.

Interestingly, the BCA defines TSCs as “multinational firms supplying identical or very similar products at different prices to retailers across countries, typically in [sic!] the disadvantage of relatively small countries like Belgium”. The BCA thus takes issue with TSCs based on a questionable definition which amounts to saying that applying varying prices in different countries for the same product is per se an infringement of the competition rules. 

BCA intends to further investigate price levels and price trends in Belgium

The BCA considers that price patterns compared to prices prevailing in France and Germany and varying results across underlying product categories require “more detailed investigation”. It adds that TSCs “remain an important topic to keep on the (Belgian and EU) policy agenda”.

The BCA refers to a recent study of the Belgian Pricing Observatory of December 2023 (in Dutch and in French), which also analysed prices in Belgium and neighbouring countries but on the basis of other datasets. In that study, the Pricing Observatory referred to another study of November 2023 which Ecorys conducted for the Dutch Ministry of Economic Affairs and Climate. In the Ecorys study, more than half of the professional buyers questioned claimed to have been faced with one or more TSCs. The study maintains that the main obstacle which buyers have to contend with is “a compulsory referral to the supplier's Dutch branch”.