JD Sports Fashion Plc responded to a recent Competition and Markets Authority (CMA) press release regarding issuing a statement of objections related to its previously announced investigation into suspected breaches of competition law by Leicester City Football Club Limited and JD Sports Fashion Plc.

The release from the CMA included the statement of objections, which sets out its provisional assessment of the case. CMA said this follows admissions by Leicester City FC and JD Sports that they broke competition law by entering into an arrangement that limited competition in the sales of Leicester City-branded clothing, including replica kits, in the UK.

CMA said in its statement that Leicester City FC and its parent companies have, under the settlement procedure, admitted Leicester City FC’s participation in the alleged arrangement. They reportedly agreed to pay a fine under the CMA’s settlement policy of a maximum £880,000; this was said to include a settlement discount from the fine that would have otherwise been imposed, reflecting resource savings to the CMA as a result of Leicester City FC admitting to acting illegally and helping bring a swifter resolution to the CMA’s investigation.

The CMA statement pointed out that, although the findings are addressed to Leicester City FC’s parent companies, as well as to the company itself, this is because of the standard legal rules that parent companies have joint and several liability for competition law infringements; the CMA is not suggesting, and has no reason to believe, that the parent companies themselves were directly involved in the unlawful conduct.

JD Sports reported the illegal conduct, and CMA said the UK-based retailer admitted its participation in the alleged conduct by way of a leniency application. JD Sports will not receive a fine provided that it continues to cooperate and comply with the other conditions of the CMA’s leniency policy.

The case relates to the following arrangement between Leicester City FC and JD Sports:

  • In August 2018, JD Sports would stop selling Leicester City-branded clothing online for the 2018/19 season;
  • In January 2019, that JD Sports would not undercut Leicester City in terms of online sales for the 2019/20 season by applying a delivery charge to all orders of Leicester City-branded clothing – disapplying its company-wide promotional offer of free online delivery for all orders over £70; and
  • By July 2020, JD Sports would continue to apply delivery charges to online orders of Leicester City-branded clothing for the 2020/21 season as well. This continued until at least 26 January 2021.

“Strong and unimpeded competition between retailers is essential to consumers’ ability to shop around for the best deals,” stated Michael Grenfell, executive director of enforcement at the CMA, in the statement issued this week. “Football fans are well-known for their loyalty towards their teams. In this case, we have provisionally found that Leicester City FC and JD Sports colluded to share out markets and fix prices with the result that fans may have ended up paying more than they would otherwise have done. Both parties have now admitted their involvement, allowing us to bring the investigation to a swift conclusion. The fine that Leicester City FC and its parent companies have agreed to pay sends a clear message to them and other businesses that anti-competitive collusion will not be tolerated.”

JD noted the following in its release:

  • JD brought the conduct to the CMA’s attention in January 2021 and has co-operated fully with the CMA throughout this investigation.
  • By bringing the matter to the CMA’s attention, JD was able to approach the CMA for leniency in accordance with the CMA’s leniency policy.
  • JD and the CMA subsequently signed a leniency agreement on June 30, 2023, under which the CMA has granted JD full immunity from any fines. In accordance with the CMA’s leniency guidance, JD will continue to maintain complete and continuous cooperation with the CMA until the conclusion of its investigation.
  • No current or former directors or senior management of JD were involved in the offending conduct, which took place in 2018 to 2021.
  • JD has taken a number of steps to strengthen its competition compliance program, and the Board reaffirms its commitment to making the necessary resource available, internal and external, to ensure that this is embedded into its daily operations.

Photo courtesy PA