Korg UK and Roland UK are the latest companies to be accused of restricting online price competition. The Competition and Markets Authority (CMA) has issued separate Statements of Objections to both companies, claiming that they required retailers to sell gear “at or above a minimum price”.
The specific objections refer to sales of Roland electronic drum kits between January 2011 and April 2018 and Korg synths and DJ production tools between June 2015 and April 2018. The CMA says: “This illegal practice, known as resale price maintenance (RPM), aims to prevent retailers from offering lower prices - meaning there are few discounts available, even when people shop around.”
These cases follow the £4.5 million fine dished out to Fender Europe for breaking competition law by preventing online discounting of its guitars. Fender admitted acting illegally and co-operated with the CMA in return for a reduced fine. Casio was fined £3.7 million for similar actions in the digital piano and keyboard market.
Ann Pope, CMA Senior Director of Antitrust, said: “When someone at the top of the chain insists on setting a minimum price online, customers lose out. Online selling should offer people more choice and the chance to benefit from competition - but this practice means that people can’t find lower prices when they shop around, which is one of the major advantages of internet shopping. That’s why we take any allegations of this kind very seriously.
“It doesn’t matter whether electronic musical instruments and kit are being purchased by a world-renowned DJ or a music enthusiast setting up a home studio - everyone should be able to buy at the best prices.”
As things stand, The CMA’s findings are provisional, and no final decision has been made about whether there has been a breach of competition law. The CMA says that it will now carefully consider any representations from both the companies before reaching any final decision in either case.