OFT Drops Tesco Price Fixing Claims And Reduces Fines

Fri, 30 Apr 2010

 
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The Office of Fair Trading has dropped some of the dairy price fixing allegations against supermarket giant Tesco .

The claims involving milk and butter sales in 2002 and 2003 are part of the OFT’s investigation into alleged price fixing on dairy products by retailers and suppliers.

The OFT said there was insufficient evidence to pursue the claims and has also agreed to reduce the penalty fine for Tesco after the supermarket told the OFT it would not contest the remaining allegations.

The watchdog said: "The OFT has concluded that the evidence it now has on file is insufficient to support an infringement finding against Tesco with regard to three alleged dairy initiatives - relating to liquid milk in 2002 and 2003 and value butter in 2003."

"In addition, on being notified by Tesco that it does not intend to contest the provisional OFT findings of a breach of competition law relating to the exchange of commercially sensitive information on certain cheese lines with two of its cheese suppliers in 2002 and one in 2003, the OFT has agreed a discretionary penalty discount of 10 per cent."

The OFT said it had also dropped all allegations against Morrisons in relation to its dairy investigation.

Morrisons said it had fully cooperated with the investigation, and had provided the OFT with clear evidence that "conclusively exonerates" the grocery retailer.

Furthermore, the OFT said it has agreed to reduce the penalties for seven other firms in the dairy investigation who had accepted liability in 2007.

Asda, Dairy Crest, Safeway, Sainsburys, The Cheese Company, Lactalis McLelland and Wiseman will now share a fine of £70 million.

The OFT said it expects to conclude the investigation by early summer.