On 5th August 2013, the OFT issued a decision finding that Roma Medical Aids Limited, a manufacturer of mobility scooters, and a number of its online retailers, some of which operated physical retail shops, had infringed Chapter I of the Competition Act 1998.
This decision is significant in that it demonstrates the OFT’s willingness to take competition law enforcement following a market study commenced under the Enterprise Act 2002 in one of the first cases of its kind. It also highlights the increasing importance the OFT attaches to its market study work. The increased market study powers contained in the Enterprise and Regulatory Reform Act 2013 only serve re-emphasise this.
The OFT held in its decision that the parties had entered into a series of agreements or engaged in concerted practices over several periods between 2011 and 2012 which prevent UK-wide online retailers from selling Roma branded mobility scooters online or from advertising their prices online.
These agreements and practices targeted the more vulnerable consumers in society. They limited consumer choice and obstructed consumers’ ability to compare prices and get value for money. In earlier investigations the OFT found that restrictions could increase the price of mobility scooters between £1,000-£3,000.
Although found guilty of competition law infringement, no fines were imposed on the parties as their turnover fell within the threshold for immunity from fines for small agreements under Section 39 of the Competition Act 1998. However, the OFT directed that the parties should bring the infringements to an end (if they had not already been terminated) and to refrain from entering into the same or similar arrangements in future.
This decision follows an earlier market study under Section 5 of the Enterprise Act 2002 into the mobility scooter sector and in particular into suspected online restrictions.
The OFT’s decision is significant because it:-
- exhibits the OFT’s willingness to take competition law enforcement action following a market study
- emphasises the importance the OFT attaches to preventing vertical restrictions in the online world
- highlights that no company, however small, is immune from competition law enforcement in the UK and that all companies need to ensure that they have suitable competition law compliance programmes in place to ensure observance with the law.