OFT: Smaller online businesses do not face anti-competitive barriers

The Office of Fair Trading has determined that small and medium-sized businesses do not face significant anti-competitive barriers online.

Research commissioned by the OFT looked into the services on which online merchants rely. The study found that in most cases, competition between the companies providing these essential services was healthy. However, the OFT did warn that some firms which rely completely on a certain service - for example, companies that rely on Google - could be in trouble if that service were to be suspended for any reason.

"Small businesses increasingly rely on services such as search engines, online market places and payment service providers as essential gateways to trading over the internet," the OFT wrote in the study report.

The study also found that the online marketplace allows small and medium-sized businesses to operate more efficiently than would be possible offline. Additionally, the presence of big-name review sites has made online shoppers more comfortable purchasing goods through an online payment gateway.

John Fingleton, chief executive of the OFT, said that the research was important to maintaining a fair marketplace because "the open and competitive nature of the internet has yielded a staggering pace of innovation, and the growth of online commerce has brought with it new business models, new firms, and whole new markets."

The Office of Fair Trading, a non-ministerial governmental department, was formed in the UK in 1973 by the Fair Trading Act. Located in Salisbury Square, London, the OFT's mission to ensure that businesses work well for consumers by maintaining open, fair and competitive marketplaces.