CMA issues no grounds for action decision in sports bras investigation
The Competition and Markets Authority (CMA) has decided to close its investigation into allegations of price-fixing involving sports bra manufacturer DBApparel UK Ltd (DBA) and 3 UK department stores.
The CMA’s predecessor, the Office of Fair Trading (OFT), opened a formal investigation following a complaint, and issued a statement of objections in September 2013 alleging that DBA had entered into a total of 9 anti-competitive agreements with John Lewis plc, Debenhams Retail plc and House of Fraser (Stores) Limited between 2008 and 2011. It was alleged that DBA and the retailers infringed competition law by entering into resale price maintenance agreements that set a fixed or minimum resale price on its ‘Shock Absorber’ brand of sports bras.
Following the statement of objections, responsibility for the decision making passed to a Case Decision Group (CDG) under procedures introduced to ensure a clear separation between the investigation and decision in each case.
After a thorough review of the evidence, including written and oral representations from the parties, the CDG has concluded that there are no grounds for action in this case.
Dr Philip Marsden, Chair of the Case Decision Group, said:
The CMA treats allegations of resale price maintenance very seriously, as it may restrict competition and mean that consumers end up paying more than is necessary. However, having carefully reviewed the evidence in this case, including the parties’ representations, we have decided that there are no grounds for action by the CMA.
Notes for editors
- The CMA is the UK’s primary competition and consumer authority. It is an independent non-ministerial government department with responsibility for carrying out investigations into mergers, markets and the regulated industries and enforcing competition and consumer law. From 1 April 2014 it took over the functions of the Competition Commission and the competition and certain consumer functions of the OFT, as amended by the Enterprise and Regulatory Reform Act 2013.
- A full summary of this case can be found on the sports bras RPM investigation case page.
- The CMA considers that agreements between a supplier and a retailer which specify a fixed or minimum resale price are a form of price fixing agreement, which typically has as its object the restriction of competition. Such agreements will infringe the Chapter I prohibition of the Competition Act 1998 and/or Article 101 of the Treaty on the Functioning of the European Union, unless an exemption applies. The CMA vigorously investigates allegations that such agreements have been made.
- CDGs are used by the CMA in Competition Act cases and are separate from the team responsible for investigating the case and issuing a Statement of Objections. The role of the CDG is to decide whether, based on the facts and evidence before them, including the parties’ representations, the legal test for establishing an infringement has been met. CDGs can include CMA panel members and will usually be chaired by a deputy chair.