Roland Broke The Law Intentionally, Says UK Watchdog

Having already detailed its reasons for handing Korg UK a £1.5 million (US$1.9 million) fine in relation to price fixing, the Competition and Markets Authority (CMA) has now explained why it fined Roland UK £4 million (US$5.09 million) for similar offences.

The CMA stated, “Between 7 January 2011 and 17 April 2018, Roland set minimum prices for its electronic drum kits, related components and accessories and told resellers not to sell below these prices.

“It used price-monitoring software to police the minimum pricing policy. This software monitored online prices to make sure resellers were selling at or above the prices Roland specified.

“In order to make sure that resellers kept to these prices, Roland threatened (and sometimes applied) sanctions against those who advertised and sold at lower prices. For example, Roland removed key discounts off the trade price for certain resellers.”

The report goes on to state that many resellers knew that Roland’s pricing policy meant that they may be in breach of competition law, and reported on each other when a price dropped below Roland’s minimum price. What’s more, it was made clear that some of Roland’s senior employees knew that what they were doing was wrong.

It stated, “One senior Roland employee noted in an internal email that they had to be very careful about talking to resellers about resale prices as Roland could be leaving itself ‘wide open for an investigation by the competition authorities’ stating that they were ‘not copying this message more widely – it is too dangerous due to the sensitive content.’

“Despite knowing what they were doing was wrong, Roland continued to enforce RPM, and took various measures to hide its wrongdoing. For example, Roland staff at times avoided creating written records and stated in an internal document: ‘Admin – Reiterate – Delete all Text messages/emails. No more emails re price.’ and communicated this policy to resellers either orally or through ‘code’. Also, on occasions, Roland staff deleted written communications about this policy.”

Roland’s fine was increased because senior management were involved, and because the illegal behavior was intentional. It was reduced because Roland admitted to breaking the law and cooperated with the CMA’s investigation.

Full Content: Gov UK

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