EC investigates abusive conduct in the energy drinks market

The European Commission has launched a formal investigation (file AT.40819) to analyze whether Red Bull has abused its dominant position in the energy drinks market.

The Commission’s investigation, in which it carried out an unannounced inspection (or “dawn raid”) in March 2023 (currently under appeal before the Court of Justice of the European Union), focuses on two lines of conduct: the alleged granting of monetary and non-monetary incentives to distributors to reduce the visibility of competing energy drinks and the possible misuse of its role as a “category captain” in supermarkets and convenience stores (i.e., in marketing, a “category captain” is a retailer’s preferred or favored supplier because its products show the best sales data within a product category; in addition, it generally provides information or advice to the retailer to boost overall sales of the product category it provides).

A new direction? First investigation by category management agreements

 The relevance of the case lies in the fact that it is the first time that the European Commission has addressed a category management agreement as a possible abuse of a dominant position. In this regard, the opening of the case confirms the Commission’s focus on analyzing the potential exclusionary effects of certain practices in the framework of vertical agreements (i.e., agreements between companies operating at different levels of the supply chain and establishing the conditions for the acquisition or (re)sale of products or services).

Category management agreements are those in which the distributor delegates to a supplier the organization of a particular category of products in its point of sale. This implies the attribution to the supplier, called the “category captain”, of a certain decision-making power over how products in that category are marketed —both its own and those of competitors— including, among others, the specific selection of products available, product placement, or its promotion in the point of sale.

The European Commission’s Guidelines on Vertical Restraints (2022) specifically address this type of agreements and note that, while they are often legitimate vertical cooperation mechanisms, they can pose risks when the supplier taking the lead in product management is at the same time a competitor to other managed brands. In particular, the Guidelines emphasize that this type of influence may have exclusionary effects when the designated supplier is involved in the assortment, placement or promotion of competing brands. In any case, category management agreements are only covered by the Guidelines (and their corresponding Regulation, i.e., Regulation (EU) 2022/720 on vertical agreements) when the market share of the supplier and distributor is less than 30% in their respective relevant markets.

The Red Bull case

According to the Commission, Red Bull could have implemented a strategy in the European Economic Area to limit the in-store presence of energy drinks in formats larger than 250 ml, a segment in which competitors such as Monster are particularly well-established. According to the press release of the Commission, with the objective of reducing the visibility or availability of this competitor’s product and favoring its own brand, Red Bull would have allegedly developed two practices:

1.    On the one hand, it would have offered economic or other incentives to distributors in the off-trade retail channel —which includes establishments such as supermarkets, gas stations or convenience stores— to remove or reduce the visibility of energy drinks larger than 250 ml.

2.    On the other hand, it would have leveraged its role as category captain to harm competing products, reducing their visibility or promoting their removal from the catalog.

Regarding the geographical scope of the practices under investigation, the Commission has focused particularly on the Netherlands, where Red Bull may have a dominant position in the wholesale market for branded energy drinks, although it does not rule out a broader extension.

In any event, the opening of a sanctioning procedure does not prejudge its outcome.

Recent trends: increased scrutiny of verticals and territorial constraints

Beyond this specific case, the European landscape shows that scrutiny of vertical practices has intensified in recent times. An example of this is the recent sanction that the European Commission imposed on fashion firms, in October 2025, for resale price maintenance, or the investigation of so-called territorial supply constraints (or “TSCs”) in the Mondelez case, restrictions consisting of limiting retailers’ supply territories with the objective of preventing parallel imports from countries with a lower price.