Tribunal overturns OFT penalties(UKPA) – 4 hours ago
12th December 2011The consumer watchdog has suffered further embarrassment after a major tobacco company and leading retailers won their battle to overturn record fines imposed over allegations of unlawful pricing.
Imperial Tobacco saw its penalty of £112.3 million reversed while Co-op, Morrisons, Asda and Shell were also successful in overturning their cases in front of the Competition Appeal Tribunal (CAT).
It comes less than a year after fines levelled on the construction industry by the Office of Fair Trading (OFT) were cut by 89% after an appeal.
At the time of last year's fine, Imperial called its punishment "illogical". It has added it always rejected the OFT's suggestion it acted anti-competitively or against the interests of consumers.
Tobacco retailers and manufacturers were fined a record £225 million after the OFT's allegations of unlawful pricing, insisting the agreements over price links between rival brands "restricted the ability of these retailers to determine their selling prices independently".
The allegations were in relation to certain promotional arrangements between Imperial - the makers of Lambert & Butler cigarettes - and multiple retailers between 2000 and 2003.
Imperial, which will seek to recover legal costs, said of the tribunal: "Under this independent scrutiny it became clear that the case the OFT was seeking to establish had no basis in fact, law or economics."
In March, fines imposed on the construction industry as a result of the OFT's biggest-ever investigation were cut by 89% causing embarrassment for the watchdog.
Kier, the FTSE 250 construction group had its fine cut from £17.9 million to £1.7 million, and at the time lawyers said the judgment put a huge question mark over how the OFT calculates fines.
A spokeswoman for OFT said: "The OFT is disappointed and we'll now be considering the judgment."
Source; http://www.google.com/hostednews/ukpres ... 703510257A
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