Newspaper publisher fined £1 million for predatory pricing

The Competition Appeal Tribunal has upheld an OFT ruling that Aberdeen Journals Ltd had abused its dominant position by predatory pricing in breach of the Competition Act 1998.

The OFT ruled, in September 2002, that Aberdeen Journals (owned by Northcliffe Newspapers Group Ltd, which is itself a subsidiary of Daily Mail & General Trust plc) had a dominant position in the market for local newspaper advertising in Aberdeen and had engaged in predatory pricing. Predatory pricing occurs where a firm deliberately incurs short-term losses in order to eliminate a competitor so as to be able to charge high prices in the future. The OFT originally fined Aberdeen Journals for this conduct on 16 July 2001. Aberdeen Journals appealed to the Tribunal which set aside that decision on grounds that the OFT's market definition was not sufficiently reasoned. The Tribunal sent the issue of the market definition back to the OFT for reconsideration, and the OFT ruled on this in September of last year. Please refer to our previous Law-Now articles:

Local newspaper group fined £1.3 million for predatory pricing

Announcements by the competition authorities

Competition Tribunal sets aside DGFT ruling

Aberdeen Journals appealed the OFT's ruling to the Competition Appeal Tribunal. The Tribunal found that the OFT's ruling was based on strong and compelling evidence and that Aberdeen Journals failed to raise reasonable doubts on the OFT's analysis. The Tribunal did however reduce the penalty imposed on Aberdeen Journals from £1.328 million to £1 million.

Aberdeen Journals may yet decide to appeal the Tribunal's decision. Decisions of the Tribunal in Scotland may be appealed to the Court of Sessions on a point of law or as to the amount of a penalty.

For further information on this matter, please do not hesitate to contact:

Susan Hankey
CMS Cameron McKenna
T: + 44 (0)20 7367 2960
[email protected]

Dick Taylor
CMS Cameron McKenna
T: + 44 (0)20 7367 2108
[email protected]

David Marks
CMS Cameron McKenna
T: + 44 (0)20 7367 2136
[email protected]