On 1 August 2019, the UK Competition and Markets Authority ("CMA") announced that it had fined Casio Electronics Co. Ltd ("Casio") £3.7 million for breaching Article 101 of the TFEU and Chapter I of the Competition Act 1998 by restricting retailer freedom to discount digital pianos and keyboards supplied by Casio online. The fine is a UK record fine for a party found guilty of retail price maintenance ("RPM").
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- Whereas RPM cases where relatively scarce a few years ago, this is one of a number of recent infringement cases in this area, demonstrating the CMA's focus on this type of behaviour. The CMA has also issued a selection of simple compliance guidance materials in this regard (see for example its compliance video and guidance notes).
- This is another example of an infringement decision which concerned the use of software to monitor prices - a recent focus of the UK competition regulator, as well as other many other competition regulators around the world.
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In April 2019, the CMA sent a Statement of Objections to Casio and its parent company Casio Computer Co. Ltd alleging breaches of competition law in relation to restricting retailer freedom to discount digital pianos and digital keyboards supplied by Casio online. Casio supplied digital pianos and keyboards to UK retailers and implemented a policy designed to restrict the retailers' freedom to set their own prices online between 2013 and 2018. The restriction required them to sell at or above a minimum price, thereby stopping them from offering price discounts.
The CMA's provisional findings mentioned how the use of software had made it easier for suppliers and retailers to monitor online prices and therefore find out about lower prices quickly and pressurise retailers to follow their minimum pricing policy. Such software is likely to also reduce incentives for retailers to reduce their prices, with retailers fearing that they will be caught quickly should they go below the agreed upon minimum price.
The CMA's fine is payable by Casio's parent company, Casio Computer Co. Ltd, as they are jointly and severally liable for the fine. The fine also includes a 20% discount for settlement.
Since 2016, there have been numerous other fines for RPM online, including in light and bathroom fittings. The European Commission has also imposed fines on companies for RPM, most recently on Asus, Denon & Marantz, Philips and Pioneer.
This is also another example of a CMA infringement decision which concerned the use of software to monitor prices - a recent focus of the UK competition regulator, as well as other many other competition regulators around the world. In 2016, the CMA fined Trod for using automated re-pricing software to align the prices of its posters and frames sold online through Amazon with those of a competitor.
With thanks to Kishen Vora of Ashurst for his contribution
