Publicans told to halt price freeze

PUBLICANS in 5,500 establishments throughout the country have been told to call time on a co-ordinated price freeze.

Yesterday, the two main bodies representing publicans – the Licensed Vintners’ Association and the Vintners’ Federation of Ireland – announced the end of the freeze which was found by the High Court to be illegal.

In a case brought by the Competition Authority, the court found that the actions of the LVA and the VFI were in breach of the settlement reached in previous hearings over alleged price-fixing in the 1990s.

The price freeze initiative was introduced last December in a determined bid to shore-up the collapsing pub trade.

More than 1,500 pubs have closed since 2001 as a result of a recession in the bar trade.

Yesterday, the LVA and VFI, the two representative bodies for Irish publicans, wrote to their respective members “to advise them of the immediate cessation of the price freeze announced on December 1 last. The High Court has found that the price freeze was in breach of an undertaking given in respect of the settlement of previous proceedings taken by Competition Authority against both associations.”

The price freeze involved a recommendation by each association to its members not to exceed existing price levels for a period of one year. Participating members remained free to compete at prices below their individual price ceilings.

Following correspondence with both associations, the Competition Authority brought proceedings against the two associations in April 2009 for contempt of court.

The CompetitionAuthority argued that the price freeze constituted a breach, by each association, of undertakings given pursuant to the terms of settlement of previous proceedings which had been settled in 2003 and 2005 respectively. Those settlement terms are the subject of a court order in respect of each association.