Bicycle sellers in price-fixing scam

THE Competition Commission has referred its findings of price fixing against 28 bicycle wholesalers and retailers to the Tribunal for adjudication.

THE Competition Commission has referred its findings of price fixing against 28 bicycle wholesalers and retailers to the Tribunal for adjudication.

The firms face the allegation that they colluded to set the wholesale and retail prices of cycles and accessories.

Wholesalers sent retailers a price list with the wholesale price and the recommended retail price on a regular basis. The recommended retail price includes a mark-up of 35percent for bicycles and 50percent for accessories.

Bicycle retailers colluded to exclude competitors like Internet retailers from the market.

The stratagem employed was to ask the wholesaler to sell to independent retailers at a higher price.

The commission believes this conduct is likely to harm competitors and consumers.

The commission has asked the Tribunal to levy an administrative penalty of 10percent on the annual turnover of each of the firms involved.

The firms facing these allegations include retailers Fritz Pienaar Cycles, Cycle Lab, Hotspot Cycles, Maverick Cycles, Dunkeld Cycles, Summit Cycles, Bester Cycles, Johnson Cycle Works, Salojee's Cycles, West Rand Cycles, Bowman Cycles and Winners Cycles.

Further it includes the following wholesalers: Thule, The Just Fun Group, Omnico, Cytek Cycle Distributors, Cape Cycle Systems, Silverback Lab, Shimano, Emotion Cycling, International Agencies, J&J Cycling, Le Peleton, Ravx Design, RFA Distributors, Supersport Cycling, Maillot Juine Trading and Bicicletta.

The commission initiated this investigation in March last year following a tip-off, a complaint by Yellow Saddle Cycling, and admissions by some of the respondents during the probe.

The commission also found that the respondents met on various occasions in 2008 to discuss prices. - I-Net Bridge

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