Last Friday’s announcement that DB Apparel UK (the English subsidiary of DBA Group of France) is being investigated for price fixing agreements with John Lewis, Debenhams, and House of Fraser is just the third in a series of high profile competition and consumer law actions taken in recent weeks by the Office of Fair Trading.
Last month saw the OFT announce its investigation into the actions of six High Street retailers suspected of engaging in misleading reference pricing and followed Tesco being fined £300,000 for a misleading summer promotion.
This in turn was preceded by the OFT issuing a decision that an arrangement between a manufacturer and seven online retailers to restrict the resale of its products and from advertising their prices online was in breach of competition law.
Whilst this decision concerned mobility scooters and the high street price referencers furniture and carpets, the implication is clear. Businesses which engage in activities which:
- fix resale prices with retailers; or
- restrict retailers from selling online; or
- restrict retailers from advertising prices online; or
- result in misleading reference pricing,
are exposing themselves to investigation by the OFT.
At best, this is likely to result in bad publicity which damages their brands and wastes management time. At worst, the agreements are unenforceable, those involved in the agreements can be fined and are exposed to third party claims for damages. And, in the very worst cases, directors and senior managers can face criminal sanctions.