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US guitar firm Fender illegally restricted discounts, says CMA | US guitar firm Fender illegally restricted discounts, says CMA |
(about 1 hour later) | |
The UK’s competition watchdog has accused the US guitar maker Fender of fixing prices illegally by restricting online discounts on its guitars. | The UK’s competition watchdog has accused the US guitar maker Fender of fixing prices illegally by restricting online discounts on its guitars. |
From 2013 to 2018, Fender Musical Instruments Europe impeded competitive online pricing by imposing a minimum sale price on vendors, the Competition and Markets Authority (CMA) said in a provisional ruling. The practice, known as resale price maintenance, is illegal and makes it difficult for customers to find good deals. | From 2013 to 2018, Fender Musical Instruments Europe impeded competitive online pricing by imposing a minimum sale price on vendors, the Competition and Markets Authority (CMA) said in a provisional ruling. The practice, known as resale price maintenance, is illegal and makes it difficult for customers to find good deals. |
Fender is the world’s biggest maker of guitars and its famous models include the Stratocaster, Telecaster and Precision bass. The Arizona-based company’s models are played by stars such as Eric Clapton, U2’s The Edge and Taylor Swift, and its basic Squier range is popular with beginners. | |
The CMA has been investigating Fender since April 2018 and has already fined the company £25,000 for concealing notebooks at its European headquarters in East Grinstead. The watchdog fined Casio £3.7m in August for restricting online discounts for its digital pianos and keyboards. | The CMA has been investigating Fender since April 2018 and has already fined the company £25,000 for concealing notebooks at its European headquarters in East Grinstead. The watchdog fined Casio £3.7m in August for restricting online discounts for its digital pianos and keyboards. |
Ann Pope, the CMA’s senior antitrust director, said: “Shopping online can make it much easier to compare prices and hunt down bargains – this can be especially important for potentially big purchases like a guitar. | Ann Pope, the CMA’s senior antitrust director, said: “Shopping online can make it much easier to compare prices and hunt down bargains – this can be especially important for potentially big purchases like a guitar. |
“We take allegations of resale price maintenance very seriously because it removes one of the benefits of the internet of making it easier to quickly find a better price by shopping around.” | “We take allegations of resale price maintenance very seriously because it removes one of the benefits of the internet of making it easier to quickly find a better price by shopping around.” |
The CMA said guitars make up a big part of the UK market for musical instruments, which is worth £400m in sales. Online sales of instruments have grown to about 40% of the market, making it important that internet vendors can offer the price they want, according to the CMA. | The CMA said guitars make up a big part of the UK market for musical instruments, which is worth £400m in sales. Online sales of instruments have grown to about 40% of the market, making it important that internet vendors can offer the price they want, according to the CMA. |
It said it had not made a final decision that Fender broke the law and would listen to the company’s version of events before coming to a verdict by the end of the year. | It said it had not made a final decision that Fender broke the law and would listen to the company’s version of events before coming to a verdict by the end of the year. |
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