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Sodastream (aka Soda Club) Defending Market Position

In 2006, Sodastream (Soda Club) tried to stop a different enterprise to refill “their” bottles of carbon dioxide (CO2), by claiming that the bottles where their property and did not belong to the customer (through contracts that all customers had to agree to).

This effort failed in Germany, and now the same could happen in other markets as well.

Competition is needed in this market niche, both in the interest of the environ­ment (bottles should be refilled in the store, an operation that takes a mere 20 seconds); and for price, which could easily be halved. More info about refilling – and home refilling – of carbon dioxide bottles for home sodamakers here.

Still, consider that home-made sparkling water already costs a fraction of store-purchased carbonated beverages; but things could be a lot better.

Here are the facts from bundeskartellamt in Germany:

http://www.bundeskartellamt.de/wEnglisch/News/Archiv/ArchivNews2006/2006_04_13.php

April 13, 2006

Düsseldorf Higher Regional Court confirms immediate enforceability in the Soda-Club case

Soda-Club GmbH, Wiesbaden (“Soda-Club“) may not use its dominant position abusively. Soda-Club had prevented competing suppliers from refilling CO2 cartridges for water carbonating machines by claiming its ownership of the cartridges.

In February 2006 the Bundeskartellamt prohibited this conduct. Soda Club opposed the Bundeskartellamt’s immediately enforceable decision by applying to the Düsseldorf Higher Regional Court for interim measures. In provisional proceedings the court has now confirmed the Bundeskartellamt’s decision in all material respects. Soda-Club is dominant in the market for refilling CO2 cartridges. Hindering competitors from refilling CO2 cartridges represents an abuse of this dominant position. By this conduct Soda-Club prevents consumers from taking advantage of alternative refilling possibilities. Only the obligation to point out on labels on the company’s own cartridges that it is admissible to have them refilled by competitors was seen by the Higher Regional Court as a disproportionate measure.

Although Soda-Club can still appeal against the Higher Regional Court’s decision to the Federal Supreme Court, the Higher Regional Court’s decision implies that the numerous small and medium-sized bottling plants can now start to compete with Soda-Club and refill all cartridges circulating in the market.



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