Thailand calls for a rice cartel

Thailand wants to form an Opec-style rice cartel to give it more control over international rice prices. The world's biggest rice exporter plans to talk to Laos, Burma, Cambodia and Vietnam about co-operating on prices. Rice prices have tripled so far this year with countries such as India and Vietnam restricting their exports. But the idea was met with opposition. The Philippines, the world's biggest importer of rice, also raised objections. "Almost three billion people are rice eaters," said Edgardo Angara, chairman of its senate committee on agriculture. "It's not a good idea, it's a bad idea. It will create an oligopoly and it's against humanity." BBC News

Think about how a cartel of this nature would have control over rice prices. Who would gain from such an arrangement?

OFT in new supermarket crackdown

Britain's four biggest supermarkets are under investigation by the Office of Fair Trading (OFT) for fixing prices of health, beauty and grocery products. The OFT also contacted some of their suppliers such as Unilever, Procter & Gamble, Reckitt Benckiser and Mars. News of the latest investigation came days after the OFT announced it was looking into allegations that tobacco firms and 11 retailers, including Asda, Sainsbury's and Tesco, had fixed the price of tobacco products. The banking and housebuilding sectors have also been the targets of the OFT recently. Companies found guilty of price collusion can expect fines under the Competition Act of up to 10% of turnover. Under the 2002 Enterprise Act, cartel-like behaviour may also carry a jail term of up to five years for directors or senior executives involved. The number of recent investigations has fuelled criticism from some business leaders over the watchdog's tactics, which have been described as overly aggressive since the OFT's current chief executive John Fingleton took charge at the end of 2005.

BBC News

Price fixing in the construction industry

More than a hundred British construction companies are facing the threat of heavy fines after the Office of Fair Trading accused them of rigging bids. In one of the competition watchdog's biggest investigations, the OFT probed thousands of tenders for construction work worth some £3bn covering schools, hospitals and private-sector developments, before focusing on 240 alleged infringements involving 112 companies.

John Fingleton, OFT chief executive, said: "Cartel activity of the type alleged today harms the economy by distorting competition and keeping price artificially high. This investigation ... will hopefully send a strong message to the construction industry about the seriousness with which we view suspected anti-competitive behaviour. Businesses have no excuse for not knowing and abiding by the law."

http://www.guardian.co.uk/business/2008/apr/18/construction.regeneration

http://news.bbc.co.uk/1/hi/business/7351867.stm