Northcliffe Newspapers Fined Over Predatory Pricing

Northcliffe Newspapers, a subsidiary of Daily Mail and General Trust plc, has been fined £1.32 million by the Office of Fair Trading (OFT) for predatory pricing among its Aberdeen Journals titles.

John Vickers, director general of OFT, commented: “Aberdeen Journal’s, deliberately incurred losses in a persistent campaign to remove its only direct rival from the market. This campaign continued despite the fact that the Competition Act of 1998 prohibited predatory pricing from March 2000, and despite an OFT investigation. This is a serious infringement of the law and should act as a deterrent to others.”

The decision marks the end of a long running saga which saw the original case against Northcliffe Newspapers thrown out after it was decided the premise on which the OFT had based its decision was not sufficiently defined.

The original investigation was triggered by complaints from a weekly free newspaper, the Aberdeen and District Independent which accused the Aberdeen Journals of acting unlawfully by undercutting it’s advertising prices.

The OFT agreed with the accusations against the Aberdeen Journal, finding that the company had deliberately incurred losses through under-selling its only direct rival in the market.

The OFT concluded that Aberdeen Journals infringed the competition act’s Chapter II prohibition, which makes the abuse of a dominant position unlawful. According to the Office of Fair Trading predatory pricing occurs when a dominant group incurs losses to deter potential competitors or remove a rival.

DMGT: 020 7938 6000 www.dmgt.co.uk

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