In August 2016 two small suppliers stopped delivering parts to Volkswagen. ES Automobilguss made gearbox parts. CarTrim made seat covers. Both said they belonged to the Prevent group. They said VW had cancelled their orders without notice, without a reason and without compensation. According to the news agency dpa, VW had been willing to pay compensation, but the demands were said to be unrealistic. This could not be verified. VW obtained court orders that told the suppliers to resume deliveries. They did not deliver. VW halted work at six German plants, which affected nearly 28,000 workers. Within days the two sides reached an agreement. VW would keep buying parts from Prevent companies for at least six years. The sum was not made public. The Süddeutsche Zeitung reported 13 million euros.
Wedding Rebates
Hochzeitsrabatte, wedding rebates, is the German term for the better terms that a buyer demands from its suppliers after a merger. At the end of 2008 the supermarket chain Edeka took over about 2,300 Plus stores from Tengelmann. It compared the purchase prices of the two chains for about 500 suppliers and asked each supplier for the better of the two terms. It also asked for a Partnerschaftsvergütung, a “partnership payment,” to fund the renovation of the Plus stores. On 23 January 2018 the Federal Court of Justice ruled that much of this was an abuse of buying power. A buyer may not pick only the best items from each contract, which the court called Rosinenpicken, picking out the raisins. It may also not ask for payments that give the supplier nothing in return. The law behind the ruling is the Anzapfverbot in Section 19 of the Competition Act. Anzapfen means to tap, as one taps a barrel. A powerful company may not demand advantages from others without an objective reason.
The court also said that hard bargaining remains allowed, even for a dominant company. What the law stops is taking something for nothing.
Fair Discretion
Billiges Ermessen, fair discretion. Section 315 of the German Civil Code covers contracts in which one side sets the price or the performance alone. The law presumes that this side must decide with fair discretion. If its decision is not fair, it does not bind the other side, and a court sets the performance instead. For households, this matters most with gas and electricity. A customer can ask a court to declare a price increase unfair. In a leading case of 13 June 2007, the Federal Court of Justice reviewed a gas price increase under this rule. It found the increase fair, because it only passed on higher purchase costs.
The review has a limit. A price that both sides agreed on is not reviewed. The rule applies only to a price that one side sets alone.
A Fair Deal for the Farm Supplier
In 2021 Germany passed a law against unfair trading practices in the food supply chain. It protects farmers and food producers with an annual turnover of up to 350 million euros when they sell to larger processors or retailers. The rules are concrete. A buyer must pay for perishable goods within 30 days of delivery. An order for perishable goods that is cancelled less than 30 days before delivery always counts as cancelled at short notice. A buyer may not change the terms of a delivery on its own. Payments for listing a product are allowed only if both sides agreed on them clearly and in advance. The law implements an EU directive, and in some points it goes further. One example is the ban on sending unsold goods back to the supplier without paying for them.
The Milk Strike and the Fair Milk
In April 2008 German retailers cut the price of fresh milk by 12 cents per liter. On 26 May 2008 the dairy farmers’ association BDM began a delivery boycott with no end date. Farmers stopped delivering milk to the dairies. On 6 June 2008 the boycott was called off, after the discounter Lidl had announced a price increase of ten cents per liter. In 2010 a new brand reached the stores: Die faire Milch, the fair milk. From each liter sold under the brand, 40 cents went to the participating farmers. Its mascot is Faironika, a cow in black, red and gold. In 2010 about 2,000 Rewe stores sold it. Rewe and Tegut stopped at the end of 2012, during a legal dispute. After that, only a few retailers and farm shops still sold it.
Hard but Fair
Die Verhandlungen waren hart, aber fair. The negotiations were hard but fair. German negotiators often say this after a difficult round, sometimes on both sides of the table. The two words do not contradict each other. Hart describes the pressure. Fair describes whether the result can be accepted. After a wage agreement in the mineral water industry of North Rhine-Westphalia in May 2022, the food workers’ union explained its result to members in one sentence: Der gefundene Kompromiss ist fair, weil er die Positionen beider Seiten berücksichtigt. The compromise is fair because it takes the positions of both sides into account.
Words for the One Who Cheats
der Halsabschneider — The throat-cutter. A person who takes advantage of others without scruples, a usurer.
jemanden übers Ohr hauen — To hit someone over the ear. To take advantage of someone, to cheat. The phrase comes from fencing, where it meant a blow to the head above the ears.
der Knebelvertrag — The gag contract. A contract that restricts one partner and is very hard for that partner to end.
Leave Something on the Table
Das ist ein Geben und Nehmen. — It is a giving and a taking. Said of any arrangement that only works if both sides contribute.
Leben und leben lassen. — Live and let live.
den Bogen überspannen — To overdraw the bow. To push too far.
den Hals nicht vollkriegen — Not to get one’s throat full. Said of a person who keeps asking for more.
The Wise Judge
Der kluge Richter, the wise judge, is one of Johann Peter Hebel’s calendar stories. It appears in his Schatzkästlein des rheinischen Hausfreundes of 1811, and it still appears in school materials. A rich man loses a cloth with money sewn into it. He promises the honest finder a reward of one hundred thalers. A good and honest man finds the money and brings it back. Now the rich man looks for a way to cheat the finder out of the reward. He claims that there were really eight hundred thalers in the cloth, so the finder must already have taken his hundred. The judge accepts the claim as stated. If eight hundred were lost, this cannot be the same money. The finder takes the money home and keeps it safe. The rich man must wait until someone finds his eight hundred thalers. So sprach der Richter, und dabei blieb es. So spoke the judge, and that is how it stayed.
Michael Kohlhaas Gets His Horses Back
Heinrich von Kleist published the full novella Michael Kohlhaas in 1810. A horse dealer leaves two horses as a pledge with the Junker von Tronka. When he returns, they are thin and ruined from hard field work. Ich will meine wohlgenährten und gesunden Pferde wieder haben! I want my well-fed and healthy horses back! He goes to court, fails, and turns to violence. At the end of the novella, the Junker is sentenced to two years in prison. Kohlhaas is sentenced to death. Before his execution, he is shown his two black horses, fattened by the Junker’s men and shining with health. Kohlhaas tells the archchancellor with joy that his highest wish on earth has been fulfilled. Then his head falls under the executioner’s axe.
Kleist calls him one of the most upright and at the same time most terrible men of his time. His sense of justice made him a robber and a murderer.