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£2.7m fine for lighting supplier, after CMA investigation (22 June 2017)

Date: 22/06/2017
Duncan Lewis, Legal News Solicitors, £2.7m fine for lighting supplier, after CMA investigation

A lighting supplier has been fined by the Competition and Markets Authority (CMA) for requiring retailers to use a minimum price when selling their products online.

The National Lighting Company (NLC) supplies light fittings to a range of retailers, who then sell them on.

After a detailed investigation, the CMA found NLC had imposed a minimum price on online sellers, who then had to retail goods at or above this price.

This kind of illegal practice, known as resale price maintenance (RPM), means customers miss out on the best possible prices and cannot shop around for a better deal on that supplier’s products.

NLC had tried to avoid detection by not committing agreements to writing.

The company has been prosecuted and fined £2.7 million for breaking competition law.

The fine covers violations in relation to its Endon and Saxby brands – and includes an extra penalty because the company ignored an earlier warning letter from the CMA.

NLC’s fine was increased for ignoring the CMA’s warning letter – however, it also benefited from a 30% reduction to the fine because it applied for and was granted leniency.

An additional 20% reduction was applied because NLC voluntarily entered into settlement with the CMA – the fine also included a small reduction as a result of NLC agreeing to implement a comprehensive compliance programme.

A warning letter may be sent when the CMA has reasonable grounds to suspect anti-competitive behaviour – it is not a formal allegation, but must be taken seriously and requires a considered response.

CMA Senior Director, Antitrust, Ann Pope, said:

“This decision should act as a warning to companies that resale price maintenance is illegal – and that warning letters issued by the CMA are to be taken seriously and not to be ignored.

“The digital economy is booming – and with so many businesses operating online it is vital that fair competition is maintained across all sectors.

“The CMA wants to ensure consumers get a fair price and a good deal – that can only happen when retailers are free to set their own prices.”


The CMA is the UK’s primary competition and consumer authority – it is an independent, non-ministerial government department, with responsibility for carrying out investigations into mergers, markets and the regulated industries, and enforcing competition and consumer law.

The CMA may send warning or advisory letters to businesses where it has concerns that they may be harming competition in their market sector.

The CMA has also sent a number of warning letters to other suppliers in the light fittings sector, where there are reasonable grounds to suspect they may also be engaging in RPM.

Receiving a warning letter does not mean that a company has broken the law – but the CMA says it currently has 12 ongoing cases open under the Competition Act 1998.

To help stamp out resale price maintenance, the CMA has also re-issued advice to help businesses stay on the right side of the law.

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