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17 October 2013 | Will Green
Clothing firm DB Apparel UK has rejected allegations from the Office of Fair Trading (OFT) that it entered into price-fixing agreements with three department stores.
The OFT issued a “statement of objections” in which it alleged DB Apparel entered into nine anti-competitive agreements with John Lewis, Debenhams and House of Fraser between 2008 and 2011.
It is alleged the agreements applied on a nationwide basis to numerous products within the Shock Absorber range of bras. During the period in question the product was one of the UK’s leading brands with a share of around 15 per cent of the market.
The OFT said the agreements “amounted to resale price maintenance”, which occurs when a supplier specifies the resale price of a product and retailers agree the set price. A statement of objections gives notice of a proposed infringement decision under the Competition Act 1998, and gives the parties involved an opportunity to respond before a final decision is taken.
Ann Pope, senior director of services, infrastructure and public markets at the OFT, said: “The OFT takes allegations of price-fixing seriously. Resale price maintenance limits competition between retailers and can lead to consumers paying higher prices.
“No assumption should be made at this stage that there has been an infringement of competition law. We will carefully consider the parties' representations to the statement of objections before deciding whether competition law has in fact been infringed.”
A DB Apparel spokeswoman said: “We reject any allegations by the OFT that we have entered into any agreement or understanding with retailers as to their retail prices of our products. We have been transparent with UK authorities since the beginning of this process and will continue to defend ourselves vigorously in this investigation.”
A John Lewis spokeswoman said: “John Lewis always strives to operate within the law and comply with regulations. We are fully cooperating with the OFT and will respond in due course."
A House of Fraser spokeswoman said: “We are co-operating fully with the OFT and the ongoing investigation and will respond accordingly. We are confident that we have been operating within all laws and regulations and are very supportive of any initiative which ensures pricing policies are fair for our customers.”
Debenhams did not respond to SM’s request for comment.