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Price fixing

Pricing fixing


Price fixing is when competitors agree on pricing rather than competing against each other. This includes agreeing to prices, a formula to calculate prices / margin or elements of a price such as discounts, rebates, promotions or credit terms.

Price fixing can occur verbally or in writing – agreement can be by a 'wink and a nod', made over a drink, price fixing can occur at an association meeting or at a social occasion.

In a competitive market, each competitor should make price decisions independently. Anything that removes price uncertainty between competitors risks being a form of price fixing which hurts consumers and other businesses.

Price fixing increases prices and reduce quality of the products sold. Under the Competition Ordinance, it is a serious anti-competitive conduct.