There are certain forms of anti-competitive conduct that are known as cartel conduct. These include agreeing with your competitors to:
- sell goods or services at the same price or agree to a pricing structure
- restrict or control the amount of goods or services available to customers
- divide or allocate customers, suppliers or geographical areas
- rig bids in a tender process.
If 2 cleaning companies agree that one will handle domestic clients and one will handle commercial clients, they have formed a cartel.
If 3 construction companies agree to take turns in submitting the lowest bids for local government tenders in their state, they have formed a cartel.
No need for a formal agreement
An informal understanding can still amount to cartel conduct. Competing businesses verbally agreeing to fix prices over lunch or at a cocktail party will be just as guilty as if the agreement was in writing and made in a boardroom.
For more information, visit Cartels