Online retailer escapes fine following FBI price-fixing investigation
AN online retailer which collapsed into administration in the wake of an FBI price-fixing investigation has avoided a fine after it reported the cartel to the authorities.
Sheffield-based GB eye Limited (trading as ‘GB Posters’) agreed with competing online seller Trod, based in Birmingham, that they would not undercut each other’s prices for posters and frames sold on Amazon’s UK website.
The agreement was implemented by using automated repricing software which the parties each configured to give effect to the illegal cartel.
The two companies sold licensed sport and entertainment merchandise and related products, including posters, frames, badges, stickers and mugs, with popular images from the sport and entertainment world, such as One Direction and Justin Bieber.
The cartel applied to posters and frames sold by both parties on Amazon Marketplace between March 2011 and July 2015. Following an investigation by the Competition and Markets Authority (CMA), Trod agreed to accept a fine of £163,371 for taking part in the cartel, whilst GB managed to escape a fine.
The CMA said: “Provided it continues to co-operate and complies with the other conditions of the CMA’s leniency policy, GB eye will not receive a fine, having reported the cartel to the CMA and co-operated with the investigation, in accordance with the CMA’s leniency policy.”
Stephen Blake, Senior Director and head of the CMA’s cartels and criminal group, said: “The internet is an increasingly important way in which people buy products or services in their everyday lives.
“Online marketplaces such as Amazon allow sellers to sell their goods directly to consumers, who often benefit from more choice and lower prices as a result. Online pricing tools, such as automated repricing software, can also help sellers compete better, for the benefit of consumers. In this case, however, the parties used repricing software to implement an illegal agreement to deny consumers these benefits.
“Sellers on online platforms need to be aware that agreeing with each other to limit price competition in this way is illegal and can have serious consequences for the companies and individuals involved.”
