TMO Sports Pty Ltd - s.87B undertaking

TMO Sports Pty Ltd (ACN: 075 986 604) is an importer and wholesale distributor of bicycle parts and accessories in Australia.

The Australian Competition and Consumer Commission (ACCC) has accepted a section 87B court-enforceable undertaking from TMO following an investigation into resale price maintenance conduct likely to contravene section 48 of the Competition and Consumer Act 2010.

The ACCC was concerned that TMO had engaged in resale price maintenance by attempting to stop retailers from discounting products supplied by TMO. Specifically, TMO:

1. said to a retailer seeking supply of Time branded bicycle frames from TMO that the retailer had to price the products at no less than 5 per cent below than the suggested retail price (SRP). TMO refused to supply to this retailer because it would not agree to the pricing condition
2. directed a second retailer to increase the price of Time branded bicycle frames on its website to the SRP
3. communicated to a third retailer that it should not advertise products on its website at a discounted price.

TMO admits that its conduct constituted or was likely to constitute resale price maintenance in contravention of section 48 of the Competition and Consumer Act 2010 (CCA), and has committed in the undertaking to:

• not engage in resale price maintenance for a period of five years,
• write to all of its retail customers informing them of the undertaking and their freedom to determine resale prices,
• include a statement with its list pricing informing customers that references to resale prices are recommendations and that there is no obligation to comply with the recommendation, and
• implement and maintain a training program for current and future staff.