CMA Fines Leicester City FC for Anticompetitive Pricing Practices

On 31 July 2023, the Competition and Markets Authority (CMA) issued an infringement decision finding that Leicester City Football Club and JD Sports had colluded to restrict competition in the sales of Leicester City-branded clothing, including replica kit, in the UK.

Leicester City FC and its parent companies reached a settlement agreement with the CMA, under which they will pay a fine of £880,000.  JD Sports had reported the infringement to the CMA, in exchange for immunity from financial penalties.

Both Leicester City and JD Sports sell Leicester City-branded clothing online.  The CMA believes that the two parties entered into an arrangement under which: (i) JD Sports would stop selling Leicester City-branded clothing online during the 2018/19 football season, (ii) JD Sports agreed not to undercut Leicester City in terms of online sales for the 2019/20 season by applying a delivery charge to all orders of Leicester City-branded clothing (even though the company otherwise offered free online delivery for all orders over £70) and (iii) JD Sports would continue to apply delivery charges to online orders of Leicester City-branded clothing for the 2020/21 season.

The fine agreed between the CMA and Leicester City reflects a settlement discount intended to recognise the resource savings to the CMA as a result of Leicester City’s admission of anticompetitive conduct, which will allow the CMA to resolve its investigation more efficiently.  As whistle-blower, JD Sports will benefit from immunity from fines, provided that it continues to co-operate with the CMA’s investigation and to fulfil the other conditions of the CMA’s leniency policy.

Michael Grenfell, the Executive Director of Enforcement at the CMA, said that the fine imposed “sends a clear message to … other businesses that anti-competitive collusion will not be tolerated.” He stressed that the rising cost of living made it especially important for football fans to benefit from competitively priced merchandise, which is consistent with the CMA’s stated objective to “help contain rising cost of living pressures,” which we reported last month.

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