As BRE seeks to achieve responsible commercial success and compete on a level playing field, we are committed to promoting fair competition and healthy marketplaces. We work in compliance with the applicable competition laws in the countries where we operate.
Competition laws, also known as antitrust laws, are designed to protect free and open competition in the marketplace, by preventing or correcting anti-competitive behaviour.
Competition is important because it:
- Lowers prices: in a competitive market, prices are pushed down because competition puts businesses under constant pressure to outperform each other in order to attract more customers.
- Improves quality: competition encourages businesses to increase the quality of products to broaden their customer base and expand their market share.
- Enhances customer experience: healthy competition acts as an incentive for market players to improve in order to distinguish themselves from the others.
- Fosters innovation – in order to get ahead of their competitors, businesses are forced to be more creative – to invest in research and development activities often resulting in technological breakthroughs and commercialisation of new, smarter technologies.
Anti-competitive behaviour refers to any kind of unfair deals that restrict free competition including (but not limited to):
- price fixing: competitors agree on the prices to be charged for their competing services or products,
- bid rigging: competitors undermine a competitive bidding process in any number of ways, such as agreeing whether or not to bid or minimum bid pricing, and
- market division: competitors divide sales territories among themselves or allocate customers so as not to directly compete.
In addition to causing damage to our reputation, breaking competition laws attracts severe penalties and may subject the company and its directors to substantial civil and criminal sanctions.
We expect everyone working for and with BRE to abide by the applicable competition laws and not engage in or tolerate anti-competitive behaviour in any shape or form, regardless of location or market.
As a rule of thumb never discuss or agree anything with a competitor that would have a negative impact on the customer base or restrict freedom in the marketplace. If a formal meeting with one or more competitors is planned, be especially vigilant. Try to ensure that a reminder to observe competition rules is stated at the outset of the meeting. Whether in the main meeting, a fringe meeting, or a side-conversation, if the topic of conversation heads in an anti-competitive direction, try to steer it off or stop it.
If all else fails, recuse yourself from the conversation, i.e. leave the meeting, or if you are chairing it close it immediately. All meetings with competitors should be minuted; ensure the minutes are circulated and reviewed for accuracy before being signed off. If you have recused yourself or not been present for any part of the conversation, check that the minutes reflect this. This could be important for BRE’s, and your own, protection.
Q: You receive information that a new company is entering the building product certification market in which you work. Later you are called by a competitor who says he has spoken with other main players in the field and all have agreed to temporarily lower their prices to make it financially unfeasible for the new company to enter the market. He suggests you join in the arrangement.
Should you do it?
A: NO. You should refuse to participate and clearly dissociate yourself from the arrangement—ideally with a permanent record, such as an accompanying e-mail. Report the incident to the Legal team. This offer amounts to ‘predatory pricing’, i.e. setting the prices of your goods/services so low that other companies cannot compete and are restricted from the market. This behaviour is contrary to the BRE Way and is a form of price fixing prohibited by law.
Dos and Don’ts
- Adhere to the BRE Way and follow the applicable competition laws.
- Disentangle and clearly dissociate yourself from any suspicious relationships or conversations with competitors that could have a damaging effect on customers or the wider market.
- Report any suspicions of possible anti-competitive behaviour to your Line Manager and/or Legal team.
- Consult with a representative from the Legal or Compliance teams if you are unsure about whether certain conduct is anti-competitive,
- Engage in practices that aim to stifle free competition including:
- agreeing with competitors to fix the price of a particular product/service,
- agreeing to divide up customers or markets,
- agreeing to isolate another competitor by collectively refusing to do business with them.