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Anti competitive agreements: small businesses can be caught too
A recent competition law case saw a group of Dutch telecoms companies fined heavily by the European Court of Justice for anti-competitive behaviour, following nothing more than a meeting between them at which the decision was taken to cut the payments they made to mobile phone dealers.
The decision confirmed that a single meeting between competitors to discuss market strategy is sufficient to constitute anti-competitive collaboration.
Competition law is tough and affects markets on a domestic and European level. Price and tender fixing, and carving up markets are particularly dangerous practices and the potential fines are severe. At present, the Office of Fair Trading is conducting a number of investigations into anti-competitive behaviour. A recent investigation into bid-rigging in the construction industry led to fines in excess of £100 million.
There is a commonly held view that the rules are only aimed at big business. This is not the case. An agreement or concerted practice which may affect trade within the UK and which has as its object or effect the prevention, restriction or distortion of competition will be unlawful. A market share in the UK as low as 10% could give rise to problems, and the OFT can fine businesses up to 10% of their annual turnover.
There are one or two exceptions to these rules, although these can be tricky to unravel. We can advise you on how to steer a safe path through the competition law minefield.