CAT Quashes OFT’s Tobacco Infringement Decision

On 12 December 2011, the Competition Appeal Tribunal (CAT) quashed, in relation to Co-op, WM Morrison, Safeway, Asda, Imperial Tobacco and Shell, a decision by the Office of Fair Trading (OFT) from April 2010 in which the OFT fined two tobacco manufacturers and ten retailers a total of £225 million for infringing UK competition law through practices which affected retail prices for tobacco products in the UK (see our earlier law now).

The OFT's decision concerned arrangements whereby suppliers linked the price of a tobacco brand with that of a competing supplier's brand and which restricted the ability of retailers to determine their selling prices individually.  The OFT's investigation was initiated by a retailer applying for leniency regarding the arrangements. The OFT reached settlement agreements with certain retailers and a tobacco producer, all of whom admitted liability for infringements of competition law alleged against them.  By contrast, Co-op, WM