Sainsbury's and Asda have admitted fixing the price of milk, cheese and butter following an inquiry by the Office of Fair Trading.
Sainsbury's and Asda have admitted fixing the price of milk, cheese and butter following an inquiry by the Office of Fair Trading.
The supermarkets, along with a number of dairy firms, have agreed to pay fines totalling at least £116m.
The supermarkets, along with a number of dairy firms, have agreed to pay fines totalling at least £116m.
Having admitted liability in principle, they now face smaller fines as a result, the OFT has said.
Having admitted liability in principle, they now face smaller fines as a result, the OFT has said.
Cases against Tesco, Morrisons and the dairy firm Lactalis McLelland will continue after no deal was struck.
Cases against Tesco, Morrisons and the dairy firm Lactalis McLelland will continue after no deal was struck.
In September, the watchdog provisionally found evidence of collusion by 10 firms relating to price-setting in 2002 and 2003.
In September, the watchdog provisionally found evidence of collusion by 10 firms relating to price-setting in 2002 and 2003.
Safeway has also admitted price-fixing, before it was bought by Morrisons.
Safeway has also admitted price-fixing, before it was bought by Morrisons.
Dairy processors Dairy Crest, the Cheese Company and Wiseman also reached agreement with the watchdog.
Dairy processors Dairy Crest, the Cheese Company and Wiseman also reached agreement with the watchdog.
We are disappointed that we have been penalised for actions that were intended to help British farmers Justin KingChief executive, Sainsbury's
We are disappointed that we have been penalised for actions that were intended to help British farmers Justin KingChief executive, Sainsbury's
Another dairy firm, Arla, has been given immunity from fines if it continues to co-operate with the investigation.
Another dairy firm, Arla, has been given immunity from fines if it continues to co-operate with the investigation.
'Disappointed'
'Disappointed'
The Competition Act of 1998 prohibits agreements, practices and conduct that may have a damaging effect on competition in the UK.
The Competition Act of 1998 prohibits agreements, practices and conduct that may have a damaging effect on competition in the UK.
The provisional OFT report from September said the collusion saw customers being charged 3p extra for a pint of milk and 15p extra per quarter-pound of butter.
The provisional OFT report from September said the collusion saw customers being charged 3p extra for a pint of milk and 15p extra per quarter-pound of butter.
The overcharging also led to customers being allegedly overcharged 15p per half-pound of cheese, the watchdog said.
The overcharging also led to customers being allegedly overcharged 15p per half-pound of cheese, the watchdog said.
Sainsbury's, which has agreed to pay £26m, said its price initiatives in 2002 and 2003 "were designed to help British dairy farmers at a time of considerable economic pressure and public debate about whether farmers were getting a fair price for their products".
Sainsbury's, which has agreed to pay £26m, said its price initiatives in 2002 and 2003 "were designed to help British dairy farmers at a time of considerable economic pressure and public debate about whether farmers were getting a fair price for their products".
"We are disappointed that we have been penalised for actions that were intended to help British farmers, but recognise the benefit of a speedy settlement with the OFT," chief executive Justin King said.
"We are disappointed that we have been penalised for actions that were intended to help British farmers, but recognise the benefit of a speedy settlement with the OFT," chief executive Justin King said.
Asda did not reveal the size of its fine, although it is understood to be less than that faced by Sainsbury's.
Asda did not reveal the size of its fine, although it is understood to be less than that faced by Sainsbury's.
A spokesman said there were "regrets" at the firm, but that its intention "was to provide more money for dairy farmers, who were under severe financial pressure at the time".
A spokesman said there were "regrets" at the firm, but that its intention "was to provide more money for dairy farmers, who were under severe financial pressure at the time".
Dairy Crest , which will pay £9.4m, said that the pricing policy occurred in the aftermath of the foot-and-mouth outbreak.
Dairy Crest , which will pay £9.4m, said that the pricing policy occurred in the aftermath of the foot-and-mouth outbreak.
"The implementation of these initiatives was very well publicised at the time and received widespread support including strong political backing," it said.
"The implementation of these initiatives was very well publicised at the time and received widespread support including strong political backing," it said.
Wiseman Dairies, which faces a £6.1m bill, said that "every penny of additional revenues paid to Wiseman was passed directly to our suppliers".
Wiseman Dairies, which faces a £6.1m bill, said that "every penny of additional revenues paid to Wiseman was passed directly to our suppliers".
"Whilst we are disappointed with the outcome of the investigation, this agreement removes a long shadow hanging over the company," chairman Alan Wiseman said.
"Whilst we are disappointed with the outcome of the investigation, this agreement removes a long shadow hanging over the company," chairman Alan Wiseman said.
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