Earlier this month, the Office of Fair Trading ("OFT")
provisionally found 50 private schools to be in breach of competition
law's Chapter 1 prohibition.
Chapter 1 of the Competition Act 1998 prohibits agreements,
decisions or concerted practices which have as their object or effect
the prevention, restriction or distortion of competition within the UK.
The named schools took part in an information sharing mechanism known
as the Sevenoaks Survey. The survey was co-ordinated by the bursar of
Sevenoaks school in Kent. Participating schools passed him their
projected fees for the coming year, he collated the information and
re-circulated it amongst the schools. The projected fee information was
updated and re-circulated on a number of occasions throughout each
year. The OFT argue that this practice breached the Chapter 1
prohibition and caused school fees to be higher than they would
otherwise have been.
The OFT's arguments have been presented in a 'statement of
objections' sent to each of the accused schools. The schools have until
March 2006 to respond to the OFT's case. If, having taken the schools'
representations into account, the OFT find the schools to be in breach
of Chapter 1, it could levy a financial penalty on each of schools of
up to 10% of the school's turnover. However, the OFT have indicated
that any fines are unlikely to be at the top end of the available scale.