The Competition Commission has released a provisional report on the A$268 billion groceries market stating that competition in local markets was inadequate and sought a closer scrutiny of relationships between retailers and their suppliers. The report also noted that existing retailer land holdings and restrictive covenants were undermining effective competition. In its provisional findings the CC proposed a series of remedies including addressing restrictive covenants, prohibited exclusivity arrangements between retailers and suppliers and recommending changes to planning regimes. In a related matter the CC ordered leading grocery retailer, Tesco, to sell off the former Co-op Store site it acquired in 2003 on the basis that the real estate acquisition significantly reduced competition and choice in the grocery retail market in Slough. The commission’s final report will be released in March 2008.
Competition Commission fines bread cartel $16.6 million
The South African Competition Commission has issued fines of A$16.6 million to Tiger Brands for its role in a bread and milling cartel, including Premier Foods, Pioneer Foods, Foodcorp and an additional 13 milling companies. The companies were charged with entering an agreement to simultaneously raise bread prices in the week before Christmas 2006, market sharing and fixing discounts awarded to independent distributors. Premier Foods was granted conditional leniency and assisted the commission in its investigations. Tiger Brands agreed to pay 5.7 per cent of its 2006 turnover and cooperated with the commission’s inquiries. (Bulletin: 16 November 2007)
On 13 November 2007 the European Commission presented the new telecoms reform package to the European Parliament proposing wide-ranging amendments to the EU Telecoms Rules of 2002. The reform package, if agreed to, will enter into force by the end of 2009 and will affect 500 million customers. The key theme of the reform package is the creation of a pan-European regulatory body called the European Telecom Market Authority, with representatives from 27 national regulators on its board and to be managed by an executive director. The reform package intends to create a single market for telecommunications throughout Europe. It includes provisions for the functional separation of wholesale and retail networks, the auction of radio spectrum for use in broadband services and to simplify telecom regulation by removing market sectors from the existing 18 to seven.
EC fines videotape cartel A$126 million for price fixing
The European Commission fined Sony, Fuji and Maxell more than A$126 million for price fixing in the market for professional videotape. The companies, who had a combined market share of 85 per cent, manipulated prices from 1999 to 2002. Fuji and Maxell received reduced fines for assisting with the EC’s investigation. These are the first fines awarded under the EC’s new cartel guidelines.
