C&A takes on Fortress Deutschland

RETAILING giant C&A has defied a court order in Germany forbidding it to give discounts of up to 20% to credit-card holders, and has extended the offer to cash-paying customers, in the biggest face-off between commerce and the country's archaic sales laws in 50 years.

The company is facing fines of hundreds of thousands of pounds but has garnered support from many politicians who say the Fortress Deutschland protectionism must fall if the country is to stay competitive in a modern world.

Under current law, German stores are restricted by central government to just two sales a year - one at the end of January, one in July. It is simply unthinkable in highly regulated Germany suddenly to offer discounts like those at C&A's 184 stores.

The Association for the Fight Against Unfair Competition, representing more than 1,600 retailers and trade associations, lobbied the court against C&A, saying members needed protection from the 'big boys' of the retailing game. However, Guido Westerwelle, leader of the Free Democratic Liberal Party, said: 'I am on the side of C&A. If a judge can prevent discounts that benefit consumers, then the law itself needs to be changed.'

German monopoly commission chairman Martin Hellwig agreed: 'It doesn't fit with our economic system to say consumers don't understand these promotions. Something must change.'

Meanwhile, C&A is unrepentant. A senior manager who asked not to be named, said: 'The fines are immaterial because turnover has been so high on the offers that we can easily afford them.'