Out-Law News 1 min. read

Competition Appeal Tribunal upholds illegal price information exchange fine


The Competition Appeal Tribunal (CAT) has upheld a fine imposed on a company for illegally sharing price information.

In December 2016 the Competition and Markets Authority (CMA) found that galvanised steel tank producer Balmoral Tanks, along with three other companies, had breached competition law by taking part in an exchange of competitively-sensitive information on prices and pricing intentions. It fined Balmoral £130,000 for its involvement.

The exchange of information took place in July 2012 at a meeting where Balmoral was also invited to join a group of companies which the CMA said were part of a price-fixing cartel. Balmoral refused to join the group, although it did share commercially-sensitive information with its competitors. The meeting was covertly filmed by the CMA.

In a separate set of proceedings the CMA fined the companies which met with Balmoral in 2012 for their involvement in the cartel.

Balmoral appealed the CMA's December decision (113 page / 1.4MB PDF), arguing that the regulator had “fundamentally misunderstood” what happened at the meeting. It said the CMA had “incorrectly characterised both factually and legally what took place” and that no confidential information was disclosed.

It also said it had cooperated with the CMA and had done everything possible to promote competition.

In its judgment (72 page / 955KB PDF) the CAT said it was satisfied Balmoral was party to the infringement, and that its conduct did involve the exchange of confidential information, rather than being simply innocuous discussion. It also found the level of the fine was appropriate.

The CMA said the CAT judgment highlighted the fact that exchanging confidential information with competitors can be a breach of competition law. It added: “Any business that is approached to join a cartel, or become involved in anti-competitive arrangements – for instance, to coordinate pricing or to share out markets between them - must immediately reject the approach, and must do so clearly and unequivocally. It is not enough to refrain from price-fixing or market-sharing. The business (and its representatives) must leave the meeting, and make clear and explicit its refusal to take part.”

Executive director for enforcement Michael Grenfell said the CMA had brought the case against Balmoral to send a “strong signal” to companies about their compliance obligations. The fact Balmoral had not participated in the cartel was reflected in the relatively low level of the fine, Grenfell added.  

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