§ Miss Lestor
asked the President of the Board of Trade when the Monopolies Report on Recommended Resale Prices will be published; and whether he will make a statement.
§ Mr. Crosland
The Report was published this morning. After a thorough investigation of recommended resale prices in a wide variety of selected trades, the Commission have concluded that the effects of the practice on price levels, and on the structure of distribution, differ in different trades, and that the effect on the public interest differs accordingly. The Commission find that there are various circumstances in which it would be in the public interest to ban recommended prices, notably where it can be shown that the recommendation of resale prices is being used as a substitute for resale price maintenance. Where there is a wide divergence from a manufacturer's recommended price, they find that the recommended price may mislead consumers in a significant number of cases, and in such instances should be dispensed with. Where there is general conformity with a recommended price, the Commission think that the number of cases in which prices will be higher is significant. On the other hand, there are certain cases where the Commission consider that recommended prices may have specific advantages—for example in relieving a retailer of the trouble of pricing independently a large number of low priced items, or in assisting a supplier to market a new product.
The Commission do not think that a comprehensive ban on recommended resale prices would be justified, nor would a ban with provision for exemption where certain benefits were established. They 288W recommend, however, that there should be legislation to enable the Board of Trade to investigate, or to refer to an appropriate body for investigation, the supply of any class of goods (which could, if appropriate, be the products of a specified manufacturer) in which the Board considered that the recommendation of resale prices might operate against the public interest. The power to prohibit the practice of recommending or otherwise suggesting resale prices should be exercisable by the Board after such investigation.
The Commission have produced a useful report and I accept in principle the main recommendation that the Government should have power to prohibit recommended prices in selected cases, after investigation. As the Commission recognise, this will require legislation in due course.