Casio has become the second MI company to fall foul of the Competitions and Markets Authority (CMA), with the government watchdog issuing ‘a Statement of Objections’. The CMA is alleging that Casio illegally prevented price discounts on its keyboards, saying: ‘The CMA has provisionally found that Casio has broken competition law by restricting retailer freedom to discount online.
‘The CMA has provisionally decided that Casio implemented a policy designed to restrict retailers’ freedom to set their own prices online between 2013 and 2018, requiring them to sell at – or above – a minimum price, and so preventing them from offering price discounts’ the statement continues.
‘This kind of illegal practice, known as resale price maintenance (RPM), means customers miss out on the best possible prices. Customers lose out on cheaper prices online because, even when they shop around, they find all retailers tend to be selling at around the same price.
‘In recent years, software has also made it easier for both suppliers and retailers to monitor online prices. As a result, suppliers can find out more quickly about lower online prices and can pressurise retailers to stick with the agreed price. The use of this ‘all-seeing’ software is also likely to reduce further the incentives for retailers to reduce their prices in the first place for fear of being caught and being sanctioned.
‘The CMA’s findings are provisional and no final decision has been made about whether there has been a breach of competition law. We will now carefully consider representations from the company before reaching a final decision’.
Buried in notes accompanying the CMA’s statement is an explanation of why Casio alone received its notification and not any music shops allegedly involved: ‘The CMA has not addressed the Statement of Objections to any retailer. This is because the CMA has applied Rule 5(3) of its Competition Act 1998 Rules, according to which it may address its proposed infringement decision to fewer than all the persons who were party to the relevant agreement/s.’