The OFT has launched a campaign to ensure minicab operators across the UK understand competition rules.
The OFT is concerned there may be a particular lack of awareness among private hire vehicle operators of the stringent civil and criminal laws against price fixing, following a number of reports of minicab operators entering into agreements with their competitors to set prices.
In several cases competitors appear to have agreed prices in their local area on a per mile or minimum journey cost basis. The most recent report involved firms in Lancashire but the OFT has received information alleging similar practices elsewhere in the UK.
Minicabs are pre-booked, with customers able to choose a service by shopping around. The market is different to taxi services where the first available vehicle is hailed off the street and fares are usually set under separate licensing rules.
Minicab operators are being warned that individuals may face criminal liability for price-fixing, including fines and even the possibility of imprisonment. In addition businesses could be fined up to 10 per cent of their total turnover.
During the campaign the OFT is working with trade associations, the Licensed Private Hire Car Association (LPHCA), the Private Hire Board and the National Private Hire Association to spread awareness of the rules.
The OFT has also written to Local Authority Trading Standards Services and taxi licensing officers informing them of these issues.
Simon Williams, Head of the OFT's Cartel and Criminal Enforcement Group, said:
'Minicab operators in some areas appear to be unaware of the importance of independent price setting. Companies are free to change their prices but must understand that the law forbids any collusion with competitors when deciding price levels.'
Steve Wright MBE, Chairman of the Licensed Private Hire Car Association, said:
'Licensed Private Hire Operators including minicabs and chauffeurs, should be aware of the fact that fixing fares with competitors is unlawful under competition law. The LPHCA welcomes the Office of Fair Trading's campaign. We will be publishing further guidance for members to promote full compliance.'
