Aberdeen group claims OFT fine decision is flawed

Aberdeen Journals has asked a Government watchdog to drop a £1.3m fine imposed for allegedly trying to drive a rival local, free weekly newspaper out of business.

The company was originally fined for predatory pricing – offering low-cost advertising space in its free weekly newspaper, the Aberdeen Herald & Post, which has been renamed the Aberdeen Citizen.

The Aberdeen Independent weekly brought the complaint to the Office of Fair Trading.

An earlier fine was quashed on appeal, but the OFT decided to proceed with its earlier decision.

At a Competition Commission hearing in Edinburgh, Aberdeen Journals claimed that the OFT director general’s decision was flawed in law.

Nicholas Green QC, representing Aberdeen Journals, said the director general had placed improper weight on evidence provided by individuals that could not be tested by other means, such as cross-examination.

And he said Aberdeen Journals’ actions had to be taken in context of what was happening in the market at that time.

It was claimed that newspaper proprietor Keith Barwell had a reputation for selling newspapers to the competition and had created the Aberdeen Independent simply with a view to pressuring Aberdeen Journals’ parent company, Northcliffe Newspapers, into buying it in order to limit financial damage.

“It is quite clear that Barwell’s conduct with the Independent was as a fire ship which had one purpose – the stimulus of an offer of purchase from Northcliffe, that would profoundly affect any analysis of any statement made by him,” asserted Green.

This assertion was dismissed by Nicholas Hoskins, for the director general, who accused Aberdeen Journals of trying to dig itself out of a hole after the fact.

And he called Green’s assertion that the director general should have produced better evidence as “nonsense”.

It was not for the director general to provide negative evidence, but to rule on the facts before him, he said.

A judgment on the hearing is not expected for several months.

By Hamish Mackay

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