Blog: Cartel offence clarified

David Flint
David Flint

David Flint and Rebecca Ferguson of Scottish law firm MacRoberts look at an atypical cartel case.

When we think of a cartel, we usually think of groups of companies exchanging sensitive commercial information at secret meetings over months, even years! However, as Balmoral have found out, the cartel offence can cover a single exchange of sensitive commercial information, as well as the classic cartel scenario.


Traditionally, the Competition and Markets Authority (CMA) and the European Commission have fined undertakings involved in classic cartels – i.e. those which involved undertakings exchanging commercially sensitive information in secret over long periods of time. More recently, both the CMA and the European Commission have been clamping down on other cartel behaviour that is prohibited by competition rules, but which traditionally has not been enforced as readily as long-standing cartels.

The CMA’s case against Balmoral Tanks Limited and Balmoral Group Holdings Limited is the first time in the UK that an undertaking has been fined for disclosing commercially sensitive information at a single meeting. The CMA found that Balmoral had attended a meeting in July 2012 and disclosed commercially sensitive information on pricing intentions to competitors in the UK galvanised steel tanks sector.

Although Balmoral refused to join a price-fixing cartel at this meeting, the single provision of commercially sensitive price information was found to breach UK competition law. The CMA fined Balmoral £130,000.

The Competition Appeals Tribunal (CAT) judgment

After the CMA finding, Balmoral appealed against the decision to the CAT, who have now upheld the CMA fine and reiterated their concern for the conduct.

The CAT found that there had been no error by the CMA in the infringement finding or in the level of fine levied against Balmoral. The CAT contended that the penalty reflected both the seriousness of the infringement as well as signalling to other undertakings that such casual pricing discussions are a breach of competition law.

Balmoral had co-operated with the CMA during the investigation and had refused to join a price-fixing cartel at the same meeting and responded with vigorous competition in relation to price and therefore received a lesser fine.


The Balmoral case serves as a reminder that any disclosure (however informal) of commercially sensitive information to competitors (especially those that involve discussions of price) is a breach of both UK and EU competition law and although not the classic cartel offences that are often fined, are covered by competition law and are potentially subject to large fines.

Therefore, even if your organisation is not involved in a cartel, you should ensure that all staff and senior management know the potential consequences of sharing commercially sensitive information with competitors, even on an informal basis, as this can and will be classed as a cartel offence.

  • David Flint is a partner and Rebecca Ferguson a trainee at MacRoberts
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