Leicester City FC has been fined £880,000 by the UK’s competition watchdog after admitting restricting online sales of its football kit with JD Sports.
The Competition and Markets Authority (CMA) said Leicester City and JD had both admitted that they broke competition law.
The companies had a deal in which JD agreed not to sell Leicester kit for the 2018-19 season and then said it would apply a delivery charge to all orders of Leicester City-branded clothing for the following two seasons in order not to undercut the club’s own online store. During that period JD was offering free online delivery for all orders of more than £70.
JD was not fined by the CMA as it reported the illegal conduct and admitted its participation.
Michael Grenfell, executive director of enforcement at the CMA, said: “Strong and unimpeded competition between retailers is essential to consumers’ ability to shop around for the best deals.
“Football fans are well known for their loyalty towards their teams. In this case we have provisionally found that Leicester City FC and JD Sports colluded to share out markets and fix prices – with the result that fans may have ended up paying more than they would otherwise have done. Both parties have now admitted their involvement, allowing us to bring the investigation to a swift conclusion.
“The fine that Leicester City FC and its parent companies have agreed to pay sends a clear message to them and other businesses that anti-competitive collusion will not be tolerated.”
JD said it had been able to apply for leniency in relation to the fine as it had brought the deal to the CMA’s attention in January 2021 and had “cooperated fully with the CMA throughout this investigation”.
It added that no current or former directors or senior management of JD were involved in the “offending conduct”.
“JD has taken a number of steps to strengthen its competition compliance programme and the board reaffirms its commitment to making the necessary resource available, internal and external, to ensure that this is embedded into its daily operations,” the company said in a statement.
The CMA’s ruling comes just over nine months after it fined JD almost £1.5m for breaking competition law by fixing the prices of some Rangers FC kit in 2018 and 2019. Fellow sports retailer Elite Sports and Rangers were also fined in relation to the deal.
In February last year, JD and its fellow retailer Footasylum were fined a combined total of £4.7m by the watchdog for sharing commercially sensitive information during an investigation by the UK competition watchdog linked to a merger deal.
An investigation by the CMA accused them of deleting phone records, and found their chairmen to have held multiple clandestine meetings, including one caught on video in a car park near Bury in Greater Manchester.
Peter Cowgill, the former executive chairman and chief executive of JD, stepped down in May last year and the group has split his role, hiring a separate chair and chief executive.
The group has also completed a review of its governance procedures and policies.
