Leicester are to be fined up to £880,000 after “colluding to restrict competition” alongside JD Sports in the sales of club clothing, including replica kit, according to the UK competition watchdog.
The Competition and Markets Authority (CMA) has said the Sky Bet Championship side and JD Sports have admitted to anti-competitive behaviour, which include “price fixing conduct”.
The parties broke competition law between 2018 and 2021 with arrangements which limited competition in the sale of clothing, the CMA said it has provisionally found.
Leicester and its parent companies have agreed to pay a fine up to the watchdog’s maximum penalty of £880,000.
JD Sports will avoid a fine after reporting the illegal activity.
In August 2018, JD Sports said it would stop selling Leicester-branded clothing online for the 2018-19 season, and in January 2019, JD Sports agreed it would not “undercut” the club in terms of online sales for the following season by applying a delivery charge to all orders, the CMA said.
It said JD Sports continued the agreement to sell all Leicester clothing with the charge until at least January 2021.
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.”
In response, Leicester stressed that no current club directors or senior management were involved in the arrangements.
“These arrangements related to a limited number of bulk orders by JD Sports, which were accepted by the club’s retail sales team over the relevant period,” the club added.
“There was no intention on the part of the club to unlawfully restrict the resale of the goods supplied and no material financial advantage to be gained from doing so, given the limited amount of kit supplied to JD Sports.
“However, the club accepts the CMA’s findings and has taken steps to strengthen its training and compliance measures to ensure the club’s retail operations fully comply with competition law.”
JD Sports also highlighted that current or former directors or senior management of JD were not involved in the offending conduct and that it signed a leniency agreement with the CMA last month.
The company added: “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.”
It comes almost a year after JD Sports, rival Elite Sports and Rangers were handed fines over price fixing on replica kits.
