Capita Education Services dominates the school administration market, with around 80 per cent of schools using its systems.

The complaint was brought more than a year ago by Bromcom Computers, London. It is concerned about the compatibility of its products with the Sims systems, which are used to collate pupil data.

Philip Neal, a Capita director, confirmed the OFT referral. He said Capita is helping schools with compatibility problems: “We have a policy of encouraging third parties to work with us, because it is more attractive to our customers. We feel we are acting properly.”

Capita Group employs more than 16,000 people at 180 UK sites and is quoted on the stock exchange.

Some of its recent contracts have run into trouble. It ran the ill-fated individual learning accounts, closed by the Department for Education and Skills because of allegations of widespread fraud. It also manages the Criminal Records Bureau, which has struggled to meet demand for staff checks.

Industry insiders are warning that the DfES’s system of electronic data collection from schools and LEAs could be threatened by a patent application from Bromcom, which covers transmission of data via the internet.

The application was submitted last April. Rival companies are waiting to see if it is accepted before challenging it. A DfES spokesman said it was aware of the application and that officials were considering their options.

The department is still advising schools not to buy licences from Bromcom’s sister company Frontline Technology Ltd for wireless transmission of pupil attendance data if they are using products made by other firms (see TES, January 17).