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Dixons cleared of overcharging

No evidence of anti-competitive practices, says Sunday Times

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Dixons does not charge too much for its PCs. And it's sort of official. The Office of Fair Trading will clear Dixons, following an informal three month investigation, the Sunday Times revealed today. An OFT search into Dixons "failed to turn up any evidence of anti-competitive practices and officials believe the enquiry is likely to be quietly shelved", the newspaper said. This is likely to disappoint lobby group the Consumers Association, which last November called for an OFT investigation into Dixons. The OFT enquiry was set in train by a letter from then Trade Secretary Peter Mandelson. At the start of the investigation, Dixons called on the Government to introduce tax breaks for PC purchases. Dixons accounts for around 15 per cent of UK PC sales -- but up to half of sales in the consumer sector. Computer prices in the UK are up to 15 per cent higher than in Germany, Europe's cheapest market for PCs. But that does not make it Dixons' fault, as The Register has argued. At Comdex fall last year, Intel No. 2 Craig Barrett launched a broadside against Dixons, accusing the retailer of making "ridiculous" margins on PCs. A few weeks later, The chip giant apologised by letter to the indignant and -- litigious -- Dixons. Dixons says margins on its PC sales are less than ten per cent -- compare and contrast Intel's 60 per cent or so gross margins. The retailer is also threatening to sue Fujitsu, after the PC vendor slammed its pricing practices. ®

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