04 February 2016

UK CMA issues statements of objections in relation to resale price maintenance

On 28 January, the Competition and Markets Authority (CMA) issued statements of objections (SOs) to Ultra Finishing Limited (Ultra), a bathroom fittings supplier, and Foster Refrigerator (Foster), a commercial cooling supplier.

The two companies are alleged to have engaged in forms of resale price maintenance. The CMA announced in August 2014 that it had opened investigations in the bathroom fittings sector and the commercial catering sector. The alleged infringement is said to have occurred between 2012 and 2014 when the minimum advertised price was introduced, which potentially breaches Article 101 of the Treaty on the Functioning of the European Union.

Ann Pope, the CMA Director responsible for these cases, said:

“The internet has driven innovation in retail markets. Where ‘traditional’ businesses operating through bricks-and-mortar shops face intense price competition from online sales, suppliers may be tempted to respond by introducing practices, like minimum advertised prices, that restrict such competition.”

This investigation shows that the CMA continues to take an interest in vertical price fixing. Ultra and Foster have until May to respond to the SOs, and based on these representations, the CMA will make its final decision as to whether there has been an infringement.

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