Antitrust – Online businesses and their antitrust obligations
EU, Irish and UK competition law prohibit price-fixing between competitors in relation to goods and services. This prohibition applies in whatever way such goods or services are sold to customers. In an important restatement on 7 November, the UK antitrust regulator, the Competition and Markets Authority (CMA), announced that it had launched a campaign to alert online sellers of goods and services about the risks of price-fixing. This followed the CMA's recent decision that two online retailers had breached the UK prohibition on price-fixing by agreeing not to undercut each other's prices for their competing products sold on a UK website. The CMA warns that, while automated re-pricing software can be used to encourage competition amongst online sellers, it is illegal as a matter of UK competition law to use it as part of a price-fixing agreement. It can be expected that the Irish antitrust authorities (i.e. the Competition and Consumer Protection Commission (CCPC) and the Irish Courts) would reach a similar conclusion in an equivalent case in Ireland. Indeed the CCPC recently looked at online practices under EU and Irish competition law in the Booking.com decision regarding pricing and availability obligations. Therefore, 3 tips for businesses selling or active online:
- Online sellers of goods or services should not agree with their competitors what prices they will charge, or that they won’t undercut each other on price;
- Competitors should not discuss their pricing intentions or strategies with each other; and
- Software providers should carefully review whether their products might facilitate such price-fixing agreements.
For further information please contact Alan McCarthy or a member of our EU, Competition & Procurement Team.
Date Published: 8 November 2016