CMA Campaign to warn sellers about price-fixing

By Chris Dawson November 7, 2016 - 5:58 pm

The Competition and Markets Authority (CMA) has launched a new campaign to ensure online sellers know that price fixing is illegal.

In the build up to ‘Black Friday’, one of the busiest times of the year for online sales, the CMA is using this opportunity to remind sellers that discussing and agreeing price levels with competitors is illegal, and can result in serious penalties.

The campaign’s key warnings are that online sellers should not:

  • Agree with their competitors what prices they will charge, or that they won’t undercut each other on price
  • Discuss their pricing intentions or strategies with competitors

The CMA have written to a number of online companies who may have dodgy pricing arrangements and are also working with online marketplaces to make sure that their message gets seen. They’re reminding sellers of the £160,000 handed down to Trod Ltd for agreeing with a competitor, GB eye Ltd, not to undercut each other’s prices when selling on Amazon’s UK website. GB eye escaped a fine by reporting the cartel under the CMA’s leniency programme.

The CMA have produced a 60-second summary guidance, setting out what price-fixing is and what it means for online sellers and advice on how to comply with competition law.

The CMA is warning providers of repricing softwares solutions that they too risk falling foul of competition law if they help their clients use software to facilitate illegal price-fixing agreements.

It should be noted that this isn’t a slap on the wrist type fine. If the CMA finds that a business has broken competition law then they can be fined up to 10% of their annual turnover, company directors can be disqualified for up to 15 years, and individuals personally involved in cartels can face up to 5 years in prison.

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