September 8, 2006

Scottish dairy giants could face massive fine after alleged price-fixing

Six of Scotland's biggest dairies, including Robert Wiseman Dairies and Graham's Dairies, are facing fines totaling almost GBP60 million (US$112 million), after being accused of colluding to fix milk prices.

The findings were part of a six-year-old investigation by the UK's Office of Fair Trading (OFT). The department alleged that the dairy firms negotiated synchronised price increases in order to avoid competing for each other's customers.

The allegations focus upon Scotland's 'middle ground' market sector, which provides milk to small retailers.

The OFT said the dairies engaged in price-fixing by sharing pricing information and co-ordinating a series of price increases between them.

However, the group added that at this stage, it should not be assumed that they have violated competition laws. 

The firms could be facing fines totaling as much as 10 percent of their worldwide turnover if they are found guilty.