The sugar market in Great Britain is shared between four firms : two producers, British Sugar and Tate&Lyle and two wholesalers, Napier Brown and James Budgett. The two producers work closely together and have more than 90 per cent of the market for retail consumers purchasing one kilogram bags. British Sugar has 60 per cent of the market share.
Napier Brown decided to package the sugar themselves and to sell it under its own brand. Then, it became British Sugar’s competitor.
British Sugar decided to reduce its prices to force Napier Brown to withdraw from the market and, secondly, refused to
supply Napier Brown.
The four firms decided to meet… About twenty meetings were organized. British Sugar and Tate&Lyle agreed to sell at a higher price than previously asked for, but still more competitive than what the mainland competitors would ask for. Since Napier Brown can’t be supplied with sugar outside Great-Britain, it followed British Sugar’s policy of increasing the prices.
2/ Does the different firms’ behaviour conform to European competition law ?