CMA fines Berendsen for cleanroom laundry competition pact

UK competition regulators have slapped a £1.7m fine on Berendsen and a rival laundry company after finding them guilty of collusion.

The Competition & Markets Authority fined Micronclean Limited and Berendsen's Cleanroom Services arm for breaking competition law by agreeing not to compete for each other’s customers in the provision of ‘cleanroom’ laundry services, which are used by businesses such as pharmaceutical and medical device manufacturers as well as NHS pharmacies.

Berendsen Cleanroom Services was fined £1.2m and parent company Berendsen Plc is jointly and severally liable for
£1.03m the fine.

After the pair had been trading in a joint venture under the ‘Micronclean’ brand since the 1980s, they agreed a new reciprocal trademark licence arrangement in May 2012 under which they agreed not to compete against each other either side of a
line drawn broadly between London and Anglesey, with Berendsen taking the southern portion. The companies also agreed not to compete for certain other customers, irrespective of their location.

“Market-sharing agreements are well established and serious breaches of competition law," said Ann Pope, CMA senior director for Antitrust Enforcement.

“Organisations like the NHS rely on the cleanroom laundry services provided by these companies, but we have found the two biggest players were dividing customers between them, leaving those customers with very little choice in service provider".

The CMA said non-competition arrangements prevent clients from shopping around to get a better deal and that can lead to higher prices, less choice and less innovation in the market.

Berendsen was taken private by France's Elis in £2.2bn takeover earlier this year.