Price comparison website: use of most favoured nation clauses

The CMA is investigating suspected breaches of the Chapter I prohibition and Article 101 TFEU in the use of certain retail most favoured nation clauses by a price comparison website in relation to home insurance products.

Case timetable

Date Action
September 2018 (estimate) Decision on whether to issue a statement of objections
March 2018 to August/September 2018 (estimate) Further information gathering, including issue of further formal or informal information requests and responses
March 2018 Decision to continue with investigation
September 2017 to March 2018 Initial investigation: information gathering, including issue of formal or informal information requests and responses
26 September 2017 Investigation opened

Case information

On 26 September 2017, the Competition and Markets Authority (CMA) launched an investigation into suspected breaches of the Chapter I prohibition in the Competition Act 1998 and Article 101 of the Treaty on the Functioning of the EU in the use of certain retail ‘most favoured nation’ clauses by a price comparison website in relation to home insurance products. Retail ‘most favoured nation’ clauses in online retailing require the provider of a product (good or service) to price that product via the online outlet (in this case, the price comparison website) at a price that is as low or lower than the price at which the product is sold at rival outlets. The CMA has previously expressed particular concerns where the rival outlets covered by the retail most favoured nation clause include rival comparison websites (so-called ‘wide most favoured nation’ clauses).

The CMA has considered retail most favoured nation clauses in several recent cases, including:

Evidence concerning the use of wide most favoured nation clauses in relation to home insurance came to the CMA’s attention during the course of its market study into digital comparison tools.

The CMA’s investigation involves the provision of financial services, in respect of which the CMA and the Financial Conduct Authority (FCA) have concurrent functions to enforce competition law. In this case, it has been agreed (pursuant to regulation 2 of the Competition Act 1998 (Concurrency) Regulations 2014) that the CMA will exercise those functions in relation to this investigation, given, in particular, the CMA’s experience of considering most favoured nation clauses, the wide range of sectors in which such clauses may be in use, and the potentially broader competition policy implications of considering them. In doing so, the CMA intends to liaise closely with, and receive support from, the FCA, making best use of the FCA’s sector expertise and of the concurrency system, in the interests of running an effective and efficient investigation.

The CMA has not reached a view on whether there is sufficient evidence of an infringement of competition law for it to issue a statement of objections to any of the parties to the agreement or agreements under investigation. Not all cases result in the CMA issuing a statement of objections.

Contacts

Assistant Project Director

Cleo Alliston (020 3738 6669, cleo.alliston@cma.gsi.gov.uk)

Project Director

Chris Prevett (020 3738 6282, chris.prevett@cma.gsi.gov.uk)

Senior Responsible Officer

Michael Grenfell (020 3738 6134, michael.grenfell@cma.gsi.gov.uk)

Published 26 September 2017
Last updated 4 April 2018 + show all updates
  1. Timetable updated.
  2. First published.