In November 2005, the French Competition Council fined the cream of Parisian hotels €709,000 for operating a price-fixing cartel.

The six ‘Palaces of Paris’ were found to have shared price information and agreed average room rates. However, Catriona Munro, a partner in the EU and competition team of law firm Maclay Murray & Spens, has warned this could be just the tip of the iceberg.

Munro cautioned: “Anti-competitive behaviour is wider than just price-fixing. Sharing commercial information can be unlawful. For instance, agreeing on, or even discussing, a common approach to dealing with increased costs could breach competition law. Similarly, sharing information about occupancy rates could, if exchanged between competitors, raise concerns.

“The penalties for infringing the rules are severe. Fines can be up to 10 per cent of group worldwide turnover and court actions for damages are increasingly a real risk. In addition, significant reputational damage and reduction in share value is almost inevitable. Raising awareness about compliance can significantly reduce these risks.”

Copyright: The Communications Business (Author: Richard Croasdale)

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