Fender Pays Record $5M Fine For Price Fixing

Fender’s European business arm has been fined a record $5 million for price-fixing as part of a broader inquiry into the musical instrument business.

The EU’s CMA hit Fender with the fine after Fender admitted to breaking competition law by pursuing a policy aimed at restricting UK retailers from discounting their online prices.

Fender was accused of forcing retailers to sell its guitars at or above a minimum price for a five year period between 2013 to 2018, The practice, known as resale price maintenance, reduces competition because when consumers attempt to price shop for a deal, they find all retailers tend to be selling at a similar price.

According to the CMA, Fender would pressure retailers they discovered offering their products at a discount to raise prices.

Fender came clean under the CMA’s ‘leniency’ and ‘settlement’ procedures, which allows a company to admit to malfeasance and cooperate in an inquiry in exchange for a reduced fine, the CMA said.

“It is absolutely essential that companies do not prevent people from being able to shop around to buy their products at the best possible price. This is especially important for expensive and popular items like guitars, and so Fender’s actions could have had a big impact on customers,” said CMA Chief Executive Andrea Coscelli.

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