Leicester City hit with £880K fine by Government after admitting to illegal agreement with JD Sports
Leicester City are hit with an £880,000 fine by the UK Government after football club admits to entering illegal anti-competitive arrangement with JD Sports
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Leicester City have received a huge fine from the Government after admitting to an anti-competitive arrangement with sportswear powerhouse JD Sports.
The Foxes have endured a disappointing few months after having their relegation from the Premier League confirmed at the end of the season, after an 18th-place finish.
But now the former top-flight champions will have to pay a fine of £880,000 after admitting their guilt.
The Competition and Markets Authority (CMA) investigation began back in September 2021, and only on Wednesday published a statement of its assessment of the case.
The club broke competition law over a three-season period after entering into an arrangement with JD Sports with the intention of restricting sales of the club’s merchandise from rivals.
Leicester have been hit with a fine of £880,000 after admitting to having broken competition law
It is a double blow for the Foxes, who were relegated to the Championship at the end of last season
JD Sports stopped selling Leicester branded merchandise online for the 2018-19 season as of August 2018, and by January 2019 agreed that they would not undercut the Foxes’ own merchandise sales by applying a delivery charge to orders.
In doing so, the sportswear company were neglecting their company-wide free delivery offer for orders over £70 on their website.
As a direct result, supporters may have ended up paying more for Leicester-branded merchandise than they should have.
By July 2020 it was agreed that JD Sports would continue to apply delivery fees into the 2020-21 season, which continued until at least January 26 2021.
Though Leicester have been hit with a hefty punishment, the sportswear company will escape a fine as a result of a leniency application, providing that they continue to co-operate and follow the CMA’s leniency policy.
JD Sports reported the dealings, with both parties complying with the investigation.
The £880,000 that Leicester will be forced to pay is a discounted amount,
‘Strong and unimpeded competition between retailers is essential to consumers’ ability to shop around for the best deals,’ said CMA’s executive director of enforcement Michael Grenfell.
JD Sports agreed to add delivery charges to Leicester-branded merchandise despite having a company-wide discount offer of free delivery on all orders above £70
‘Football fans are well-known for their loyalty towards their teams. In this case we have provisionally found that Leicester City FC and JD Sports colluded to share out markets and fix prices – with the result that fans may have ended up paying more than they would otherwise have done.
‘Both parties have now admitted their involvement, allowing us to bring the investigation to a swift conclusion.
‘The fine that Leicester City FC and its parent companies have agreed to pay sends a clear message to them and other businesses that anti-competitive collusion will not be tolerated.’
JD Sports added that no directors or senior management of JD – either current or former – played a part in the ‘offending conduct’.
