What is a cartel?

A cartel is formed when businesses agree to act together instead of competing with each other, all the while maintaining the illusion of competition.

A cartel is a group of independent businesses whose concerted goal is to lessen or prevent competition.

The most common forms of cartel conduct are:

  • Rigging bids: two or more individuals conspire to manipulate a tendering process
  • Fixing prices: two or more competitors agree on pricing for the supply of goods or services
  • Market allocation: two or more competitors agree to allocate sales, territories, customers or markets amongst themselves
  • Output restriction two or more competitors agree to control or limit the quantity of goods or services produced or supplied

Cartels are illegal because they lead to higher prices, decreased product choice and less innovation. They syphon off billions of dollars from the global economy each year.

For more information on cartels, consult Cartels in Canada or About cartels.

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