Provisional finding in the CMA roofing materials investigation
First published by Author on May 09, 2019 in the following categories: Cartels Investigations Latest Market Sharing Price Fixing Pricing and tagged with cartels | cma | competition law | investigations | marktet sharing | price fixing | pricing
There’s been a provisional finding in the CMA roofing materials investigation that was launched in the summer of 2017, with three major suppliers alleged to be in a cartel.
The CMA (Competition and Markets Authority) believes that the three alleged cartel companies have been allocating customers, as well as information sharing and colluding on price. This type of behaviour usually only leads to one thing: bigger profits for the companies, and higher costs for the consumer.
An allegation of a cartel finding is incredibly serious, and the companies at the heart of this investigation could be issued significant fines that can run into the millions.
About the CMA roofing materials investigation
The CMA roofing materials investigation was launched in July 2017, with the regulators looking into suspected anti-competitive arrangements.
The material at the centre of the investigation is rolled lead, with the three companies alleged to be involved in the cartel sharing 90% of the market in the UK.
The companies being investigated by the CMA are:
- Associated Lead Mills Ltd and its sister company, Jamestown Metals Limited;
- Calder Industrial Materials Ltd;
- J. Enthoven Ltd (who trade as BLM British Lead).
A wealth of evidence was gathered during 2018 as part of the ongoing investigations, and in March 2019, a provisional finding has been made.
Provisional finding and statement of objections issued
A statement of objections has been issued over the CMA roofing materials investigation, with suspicions that the three companies involved in the alleged cartel have:
- Colluded on pricing;
- Intentionally refrained form targeting some of each other’s customers (effectively allocating customers);
- Shared commercially sensitive information with each other;
- Refused to supply to a company whose business threatened to disrupt their alleged market sharing arrangements.
Speaking about the alleged cartel and the ongoing investigation, the CMA said:
“After a thorough investigation, the CMA has today provisionally found that these 3 companies colluded among themselves to share out the market.
The CMA hopes that this provisional finding will send a strong reminder that companies need to follow competition laws. These are crucial to protecting customers from paying more for products than they should do.”
Next steps in the CMA roofing materials investigation
Now that a provisional finding has been made, the companies who are alleged to be involved in the cartel have some big decisions to make. They will need to consider the evidence the CMA has and either accept or deny the allegations that have been made.
Cartels are serious, and the CMA has the power to bring them down and issue huge fines. Any finding of a breach of important competition law could have serious consequences for those involved.
The importance of the CMA roofing materials investigation is huge, and we will continue to track developments as time goes on.