The Competition and Markets Authority’s (CMA) latest cartel awareness campaign aims to educate businesses about which practices are illegal and is urging people to come forward if they suspect a business has taken part in cartel behaviour, such as fixing prices or rigging contracts.
The campaign is targeting industries including construction, manufacturing, recruitment, estate agents and property management and maintenance. These are sectors identified as particularly susceptible to cartels. Previous campaigns have driven a 30% rise in the number of tip-offs to the CMA’s cartels hotline.
Research released by the CMA shows that out of amongst 1,000 companies surveyed:
- only 57% knew it was illegal to fix prices
- nearly half either didn’t know or thought it was legal to discuss prices with competing bidders when quoting for new work (23% said ‘don’t know’, and 25% actually thought it was legal)
- significantly more than half (59%) didn’t know or thought that dividing up and sharing customers with rivals was legal (24% said ‘don’t know’ and 35% actually thought it was legal)
Examples of CMA action include:
- Two of the biggest suppliers of charcoal and coal for households in the UK were fined £3.4 million for taking part in a market sharing cartel.
- Water tank firms were fined over £2.6 million, after they formed a cartel to divide up customers, fix minimum prices and share commercially sensitive information for tanks used in large construction projects (such as schools and hospitals).
- Somerset estate agents were fined over £370,000 for fixing minimum commission rates, such that local home owners had been denied a fair deal when selling their property. The CMA also secured the disqualification of 2 company directors in this case.
- An Amazon Marketplace seller was fined over £160,000 and its director disqualified from running a company after agreeing to fix the prices of popular posters and frames with a competitor.
Howard Cartlidge, Senior Director of Cartels at the CMA, said, “Businesses that fix prices or rig contracts are breaking the law and ripping people off. The victims are customers and other businesses, who are getting cheated out of a fair deal. If you know of something illegal – do the right thing and tell us about it.”
Since April 2015 the CMA has issued over £155 million in fines following investigations into anti-competitive practices and it is currently investigating 15 cases including in construction services, roofing materials and estate agency.
Visit the CMA anti-cartel website