OfCom investigates price fixing in delivery sector

OfCom has launched an investigation into price-fixing in the business parcel delivery sector.

According to the communications watchdog, the investigation is sets to determine whether arrangements between companies have been made to fix prices, therefore breaking European competition law.

It said the investigation would look into “suspected market sharing and/or customer allocation arrangements between operators in the business parcel delivery sector in the UK and/or European Union.”

The arrangements in question are to be scrutinised over whether they prevented, restricted or distorted competition in the United Kingdom or European Union.

OfCom has declined to say which companies are being investigated. It however has said that the investigation is at an early stage and no conclusions have been made as to whether competition law has been breached.

In a statement, OfCom said “If OfCom finds there is sufficient evidence of one or more breaches, we will issue a Statement of Objections to the relevant operators.”

On the surface, the delivery sector is extremely competitive with massive investment being made by different companies to shave margins as finely as possible. There may however be truth in the matter of anti-competitive practices being undertaken between the delivery companies, as margins are so fine that in some cases it may be difficult to operate in normal market conditions. This is not to prejudge the Investigation, as one can only comment on the fact that the investigation is being undertaken by the watchdog.