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The CMA today announced that it has taken a decision finding an infringement of Chapter I of the Competition Act 1998 by Ultra Finishing Limited, a leading supplier of bathroom fittings. A penalty of £786,668 has been imposed (reduced from £1,032,502 to reflect the compliance programme and early settlement). The infringement concerned the advertising and setting of prices for online sales. The CMA had earlier announced the settlement agreement in this case.
In its press release the CMA explains that it has awarded a further 5% discount to Ultra for setting up a compliance programme. The programme “includes a clear commitment to competition law compliance by the Ultra Board, including an external statement to that effect, which has been published on Ultra’s website. The company will also roll out tailored compliance training for all employees, and has put in place a detailed procedure to identify, assess and mitigate competition law risks. Ultra will review the compliance programme on an annual basis and submit a report on its compliance activities to the CMA each year for the next three years.” This is a useful indication of the type of compliance programme that the CMA is likely to regard as appropriate in other cases where a discount is sought for setting up such a programme.
The CMA also states that it has issued warnings to other suppliers in the sector for similar practices, and warns that it is prepared to issue further infringement decisions and warnings in future. In particular, it warns retailers (who were not subjected to any finding of infringement in this case) that they, too, may be fined in future cases of resale price maintenance, and draws attention to its leniency programme. The CMA’s message is clear: if you are a retailer who pressurises your supplier to “crack down” on online discounting by your competitors, or if you are yourself subjected to such a crackdown, you should go to the CMA – or else you are at risk of being fined.
George Peretz QC advised Ultra Finishing Limited throughout the CMA’s investigation.