LONDON (Alliance News) - UK energy regulator Ofgem Tuesday said it has closed its investigation into whether some price comparison sites breached competition law because it believes pursuing the investigation would be a waste of resources given the current evidence available.
Ofgem launched the investigation in early February to look at whether two or more price comparison sites, including one owned by Moneysupermarket.com Group PLC, had breached competition law by sharing "commercially-sensitive" information on the commission rates charged to energy suppliers.
However, Ofgem said it has now closed the investigation on "administrative priority grounds," claiming it should place its efforts to other areas of work.
"At this stage, and on the basis of the evidence gathered to date, we consider that it would be
more appropriate to devote our resources to other areas of our work, rather than continuing with this investigation," said Ofgem.
"In light of these factors, we have therefore decided that it is appropriate to close this investigation on administrative priority grounds and have, in accordance with the Competition Markets Authority's practice, sent advisory letters to relevant companies," the regulator added.
Moneysupermarket.com released a statement in response to the decision on Tuesday, noting Ofgem's comments that price comparison websites play an important role in ensuring that energy markets function well for consumers.
Ofgem said price comparison websites need to "consider who their competitors are" and who they share potentially sensitive information with, highlighting that certain affiliates and white label partners may be "actual or potential competitors," meaning price comparison sites need to restrict the flow of information.
A white label partner is a company which may produce a product or service which is then branded under a different company's name.
Only a week after the CMA released its long-awaited proposals to counter a lack of competition within the UK energy market, Ofgem said the direct or indirect exchange of potentially commercially-sensitive information with competitors could give rise "to serious competition concerns."
"For the avoidance of doubt, it should not be assumed that there has been a breach of the CA 98. Closing an investigation at this stage and in such a manner would not preclude Ofgem from reopening the investigation should circumstances arise which would justify such action. We will continue to monitor the operation of the market and take any action as appropriate," said Ofgem.
Ofgem also said the separate investigation launched in October 2015 into whether price comparison websites breached competition law in relation to paid online search advertising is unaffected by the closure of this investigation and is continuing as planned.
Other price comparison sites owned by companies listed in London include USwitch, owned by online property portal Zoopla Property Group PLC, and GoCompare, which is owned by insurer Esure PLC.
By Joshua Warner; joshuawarner@alliancenews.com; @JoshAlliance
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