The uncertainty principle

As the August issue of Catering Insight was going to press, we learned that the Competition and Markets Authority (CMA) had once again announced it was prolonging its investigation into suspected breaches of competition law, regarding the sale of commercial catering equipment.

On one level it’s understandable that the CMA is taking its time to ensure the case is thorough and accurate – indeed, the authority wrote to us in June to clear up confusion surrounding the investigation, and in its message it detailed that it has continued to find it difficult to gather the information it requires about the catering equipment sector.

However, this does not help catering equipment distributors and manufacturers, who are stuck in limbo-land wondering if their pricing structures and dealings with each other will land them in hot water.

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The investigation extension could suggest there is evidence that minimum advertised pricing (MAP) is being employed by some in the catering equipment industry, and the case information page on the CMA website now no longer shows any further deadlines for the investigation’s progress – making this an indefinite, ongoing worry for dealers and manufacturers.

Speaking to Catering Insight, Simon Belgard, CMA’s senior media relations manager, said: “It has been left open-ended as it is unclear what course of action will be taken. We need to acquire more information before we can make any decisions.”

Since the investigation was announced last year, Catering Insight has spoken to a number of companies in the industry about the possible implications for the market.

Earlier this year, Manitowoc’s national sales manager for UK and Ireland distribution, Steve Hemsil, said the manufacturer had not been approached by the CMA, but that the investigation will draw a line under the MAP issue. “The industry will then know what it can and can’t do. There’s obviously something going on because the investigation keeps being protracted, and that’s never a good thing, because there is indecision within the industry.”

During its annual supplier conference in Manchester in July, Lockhart Catering Equipment confirmed that it remains “very supportive” of any investigation into anti-competitive practices.

Asked if the company had been contacted by the CMA since the case opened last year, MD Paul Nieduszynski said: “We have been asked to comment, as I think the whole of the distribution market has. As both Lockhart and Bunzl we have been really supportive of that investigation.” He believes that irrespective of the direction the CMA’s work takes, the topic of MAP will “reach a natural conclusion”.

In the meantime, the industry will have to cross its fingers and wait it out. Let’s hope that clarity will be forthcoming sooner rather than later.

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