Anti-competitive agreements could be written and formal but they are usually verbal, informal and secret. You may still be in a position to spot such activities, and should be alert especially if the action(s) of your suppliers or other business partners appear to fall within any of the anti-competitive scenarios as described in the previous section and below. Cartels may occur in almost any industry but certain markets may be more susceptible because of their inherent structure. Such markets tend to have the following characteristics:
- Few competitors, therefore making it easier to communicate with one another
- Products with similar characteristics, making it easier for cartel members to monitor one another’s prices
- High barriers to entry for potential entrants, making it easier for cartel members to maintain high prices
- Established communication channels between competitors, that helps them to agree on and monitor the prices
- Excess production capacity as cartel members seek to control production to prevent below cost pricing
Is there any exclusion or exemption?
Not all agreements among competitors are anti-competitive. Agreements with overall net economic benefit and vertical agreements between two or more parties operating at a different level of the production or distribution chain may be excluded.
Click here for a comprehensive list of exclusions and exemptions.