Office of Fair Trading (OFT) closed Competition Act 1998 case.
Full text of the decision: spacerbars.pdf
29 June 2006
The OFT has concluded that a number of suppliers of aluminium double glazing spacer bars (each a Party, together the Parties) have been parties to an agreement and/or concerted practice that infringes the prohibition imposed by section 2(1) (the Chapter I prohibition) of the Competition Act 1998.
The Parties have infringed the Chapter I prohibition by participating in an agreement and/or concerted practice during November/December 2002 in the market for the supply of aluminium double glazing spacer bars (aluminium spacer bars) in the UK, comprising the following sub-agreements and/or concerted practices:
(a) customer allocation/market sharing in relation to certain target customers for aluminium spacer bars of a rival undertaking
(b) fixing a target price in relation to those target customers, for the most popular sizes of aluminium spacer bars, and
(c) a non-compete arrangement, which included the fixing of a minimum price, in relation to other customers, for the most popular sizes of aluminium spacer bars.
The OFT considers that agreements and concerted practices between undertakings that directly or indirectly fix prices or share markets are among the most serious infringements of the Act. In this case, the infringement consisted of both price fixing and customer allocation/market sharing. The ultimate aim and result of such a strategy is a reduction in competition, resulting in higher prices and less choice, to the detriment of customers and ultimately consumers. Financial penalties are therefore being imposed on all of the Parties, subject to the operation of the OFT’s policy to give lenient treatment to undertakings coming forward with information in cartel activity cases and fully co-operating with the OFT’s investigation.
In line with this policy, Ulmke Metals Limited has been granted full immunity in recognition of its cooperation with the OFT’s investigation. In addition, Thermoseal Group Limited has been granted a 40 per cent reduction of its penalty, also under the leniency policy.
The businesses involved in the OFT's investigation (with fines in brackets) were:
- EWS (Manufacturing) Limited (£490,050)
- Thermoseal Group Limited (£380,700, reduced to £228,420 by leniency)
- Double Quick Supplyline Limited (£180,000)
- Ulmke Metals Limited (£333,300, reduced to £ nil by leniency).