UK Watchdog Alleges Fender Restricted Online Price Discounting

A U.K. watchdog has alleged that Fender Musical Instruments Europe Limited (Fender Europe) has illegally restricted discounting for its guitars online and could be fined.

In a statement, the Competition and Markets Authority (CMA) alleged that between 2013 and 2018 Fender Europe broke competition law by restricting online price discounting for its guitars as part of a provisional decision.

The CMA recently fined Casio £3.7 million in August 2019 for a similar practice known as resale price maintenance (RPM) where retailers are made to charge a minimum price.

Fender has the opportunity to appeal against the decision before any potential fine is imposed.

"Shopping online can make it much easier to compare prices and hunt down bargains – this can be especially important for potentially big purchases like a guitar," said Ann Pope, CMA's senior director of antitrust, in a statement. "We take allegations of RPM very seriously because it removes one of the benefits of the internet of making it easier to quickly find a better price by shopping around. It stops online retailers from selling at the prices they want to, and this then leads to higher prices for customers."

Fender issued a statement in which a Fender EMEA spokesperson said: "Fender is cooperating fully with the CMA's investigation, and we are reviewing the provisional findings."