CCPC secures commitments in Resale Price Maintenance case
Outcome of investigation
Following an investigation on 15 April 2021, Coach House and the CCPC entered into an agreement in which Coach House has agreed not to engage in Resale Price Maintenance (RPM). RPM is an agreement between a supplier and a reseller, usually a retailer, which requires goods or services to be sold at or above a price or margin specified by the supplier. A typical RPM agreement may require a reseller to sell the goods or services at a specified price or above a minimum price which has been decided by the supplier.
In particular, Coach House agreed not to impose or agree any terms and conditions that oblige its resellers to use its suggested, minimum or fixed resale prices for household furniture products and secondly, not to restrict resellers from independently setting the resale price of household furniture products.
On 14 May 2021, the CCPC applied to the High Court, with Coach House’s consent, to have the agreement made an order of court under section 14B of the 2002 Act. The order was granted and came into effect on Tuesday 29 June 2021.
Outline of case
In April 2019, the CCPC opened an investigation into suspected anti-competitive practices by Chairs Limited, trading as Coach House in relation to the supply of household furniture products in the State, contrary to section 4(1) of the Competition Act 2002 (the 2002 Act) and/or Article 101(1) of the Treaty for the Functioning of the European Union (“TFEU”).
The investigation involved an assessment of whether the manner in which Coach House’s then suggested selling prices were applied by Coach House could constitute Resale Price Maintenance (RPM), contrary to section 4(1) of the 2002 Act and/or Article 101(1) TFEU.
On 1 May 2020, the Competition and Consumer Protection Commission (CCPC) issued a letter to Chairs Limited, trading as Coach House (Coach House) which formally set out the CCPC’s preliminary findings and identified competition concerns. The CCPC had formed the preliminary view that Coach House may have engaged in RPM during the period from March 2013 to August 2017 by enforcing its then-suggested selling prices on four resellers of its household furniture products in the State, contrary to section 4(1) of the 2002 Act and/or Article 101(1) TFEU.
Coach House did not agree with the CCPC’s Preliminary Findings, and denied that it had infringed section 4 of the 2002 Act and/or Article 101(1) TFEU. Coach House did however engage cooperatively with the CCPC throughout its Investigation to find a way to address the CCPC’s competition concerns and conclude the investigation.
In the interests of ensuring that the investigation could be concluded in a way that was acceptable to both parties, the CCPC and Coach House, entered into an agreement on 15 April 2021. Coach House has agreed to give a commitment not to engage in RPM conduct and, in particular:
- to refrain from imposing or agreeing any terms and conditions that place obligations on its resellers to adhere to Coach House’s suggested, minimum or fixed resale prices for household furniture products; and
- to refrain from restricting the ability of resellers to independently determine the resale price of household furniture products.
The CCPC considers that these commitments address the competition concerns arising from its investigation.
On 29 June 2021, the High Court made the commitments an order of court, binding for seven years.