The Competition Appeal Tribunal (the "CAT") has rejected an appeal by Argos and Littlewoods against an Office of Fair Trading
("OFT") decision that they were guilty of operating an illegal price fixing cartel
in respect of Hasbro toys and games. The two companies have been
fined a total of £22.6m.

In November 2003 the OFT found Argos, Littlewoods and Hasbro guilty of entering
into an agreement to limit the retail prices for Hasbro's toys
and games to Hasbro's Recommended Retail Prices ("RRP"). Hasbro were subsequently released from their £15.59 million fine because they
had taken full advantage of the OFT's leniency programme by 'blowing
the whistle' on the arrangement and co-operated during the OFT's
investigation. Argos and Littlewoods were fined £17.28 million
and £5.37 million respectively. These fines have been upheld
by the CAT, though the companies are expected to challenge their
level early in 2005.

In this case the OFT and CAT relied on a number
of sources of evidence, including e-mails which suggested an
agreement existed, employee witnesses from Hasbro and independent
price analysis. This case reiterates the fact that suppliers
should be vary careful when issuing RRPs and trying to persuade
retailers to respect them.

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