Cycling industry faces price fixing penalties

Their finding was based on the fact that wholesalers sent retailers a price list with the wholesale price and the recommended retail price on a regular basis. The recommended retail price includes a mark-up of 35% for bicycles and 50% for accessories. In turn, the ceiling on mark-ups also determined the profit/margin that retailers could make on cycles and accessories.

Firms facing these allegations includes retailers such as Fritz Pienaar Cycles, Cycle Lab, Hotspot Cycles, Maverick Cycles, Dunkeld Cycles, Summit Cycles, Bester Cycles, Johnson Cycle Works, Salojee's Cycles, West Rand Cycles, Bowman Cycles and Winners Cycles and wholesalers such as Thule, The Just Fun Group, Omnico, Cytek Cycle Distributors, Cape Cycle Systems, Silverback Lab, Shimano, Emotion Cycling, International Agencies, J&J Cycling, Le Peleton, Ravx Design, RFA Distributors, Supersport Cycling, Maillot Juine Trading and Bicicletta.

The Commission stated that they are in possession of the minutes of a meeting between various cycling retailers and wholesalers which took place in September 2008 in Gauteng. According to the Commission an agreement was made to increase retailers' prices and to "fix" prices, discounts and other trading conditions. The minutes of the meeting were posted on an online cycling website www.thehubsa.co.za (an internet cycling retailer).

Cycling retailers responded that the above mentioned meeting was an open forum discussion convened to discuss the bicycling industry as a whole, where more than 40 retailers and wholesalers were present.

The intention of the meeting was set out to find solutions to challenges facing the industry that would benefit wholesalers, retailers and consumers. They maintain that the minutes that this enquiry is based on are inaccurate and not a true reflection of the intentions of the parties concerned.