The CMA has fined Ping £1.45m for preventing 2 UK retailers from selling its golf clubs on their websites, notwithstanding that the CMA found that “Ping was pursuing a genuine commercial aim of promoting in-store custom fitting.”
EU regulators make it clear that a ban on internet sales is equivalent to a ban on passive sales which is a so called ‘hardcore’ restriction- very likely to be deemed anti-competitive. In this case the CMA appears to accept that there might have been a commercial justification – to encourage in store fitting for its clubs- but clearly in this case the CMA has concluded that this justification was insufficient to overcome a relatively strong presumption of illegality.
The case emphasises once again the importance of companies ensuring that they do not inadvertently engage in what regulators might consider are obvious competition law infringements whether online sales bans, passive sales bans or resale price fixing. Even where the company considers it has a legitimate commercial justification it will be rare for a regulator to accept as legal behaviour that is typically considered problematic.
We understand that Ping may appeal the judgment to the Competition Appeal Tribunal and if so, this is likely to provide further clarity on the interaction between a commercial rationale revolving around bricks and mortar sales process, and restrictions on internet sales.
Gustaf Duhs