01:49, 2008-Apr-29
LONDON -The U.K. Office of Fair Trading said Friday that it has issued a statement of objections alleging that certain tobacco manufacturers and retailers have engaged in unlawful practices in relation to retail prices for tobacco products in the U.K.
The statement of objections sets out the OFT's proposed findings against tobacco manufacturers Imperial Tobacco and Gallaher, and eleven retailers - Asda, the Co-operative Group, First Quench, Morrisons, Safeway, Sainsbury, Shell, Somerfield, T&S Stores, Tesco and TM Retail.
The OFT alleges that these tobacco manufacturers and retailers variously engaged in one or more unlawful practices in relation to retail prices for some or all of a number of tobacco products in breach of the Competition Act 1998.
The alleged practices comprised:
* Arrangements between each manufacturer and each retailer that restricted the ability of each of these retailers to determine its selling prices independently, by linking the retail price of a manufacturer's brand to the retail price of a competing brand of another manufacturer. The alleged infringements span different periods for different parties between 2000 and 2003; and
* In the case of Gallaher, Imperial Tobacco, Asda, Sainsbury, Shell, Somerfield and Tesco, the indirect exchange of proposed future retail prices between competitors. The alleged infringements span different periods for different parties between 2001 and 2003.
John Fingleton, OFT Chief Executive, said: "At this stage it should not be assumed that the parties involved have broken the law, and the OFT will decide if the law has been breached after it has reviewed any responses to the statement of objections".
The addressees to the statement of objections are the following companies: Imperial Tobacco Limited; Gallaher Limited; Asda Stores Limited; Co-operative Group (CWS); First Quench Retailing Limited (which trades under several retail brands, including Threshers); Wm Morrison Supermarkets; Safeway Stores; Sainsbury's Supermarkets; Shell UK; Somerfield Stores; T&S Stores; Tesco Stores; and TM Retail.
The infringements alleged against each party include:
* Linking the retail price of a manufacturer's brand to the retail price of a competing brand of another manufacturer:
* March 2000 to at least mid 2003: Gallaher, Imperial Tobacco, Asda, the Co- operative Group, First Quench, Morrisons, Safeway, Shell, Somerfield, T&S Stores and TM Retail
* March 2000 to early 2003: Gallaher, Imperial Tobacco and Sainsbury
* March 2000 to mid 2003: Gallaher, Imperial Tobacco and Tesco Indirect exchange of proposed future retail prices between competitors:
* Late 2001: Sainsbury to Tesco via Imperial Tobacco
* Early 2002: Imperial Tobacco to Gallaher via Asda
* Early 2002: Imperial Tobacco to Gallaher via Somerfield
* Mid 2002: Imperial Tobacco to Gallaher via Shell
* Early 2003: Gallaher to Imperial Tobacco via Shell - -