The Office of Fair Trading has made a new statement concerning competition law. This statement says that directors who should have been aware of their company’s breach of competition law now face the same disqualification risk as directors who have actively participated in the breach. The statement is not new but the Office of Fair Trading will now make active use of it as part of its enforcement armoury.
It applies to any breach of competition law, unlike the second sanction: the cartel offence can entail up to five years’ imprisonment and unlimited fines for any employee. Both sanctions can be applied at the same time.
They make use of that because imposing financial and other penalties on companies are not enough deterred.
The Office of Fair Trading must follow a certain procedure to disqualify a director. They must apply to the High Court for an order, on the basis that the individual is incapable to be a director. The order may disqualify the director from directorship of any company for up to 15 years.
The Office of Fair Trading will also consider mitigating circumstances, such as quick remedial action and if they know whether the activity constituted a breach or not.
All company directors are expected to appreciate the importance of competition law compliance and to know that price-fixing, market sharing and bid rigging are likely to breach competition law.
It seems to me that the Office of Fair Trading is very hard on the directors who didn’t participate in the breach of competition law. I think that it goes to far when the directors who didn’t do anything are punished in the same way as the directors who participated in the breach. They have to give them a lower fine so that they take more responsibility.
http://www.hvnplus.co.uk/intelligence/regulation/competition-law-inaction-is-no-longer-an-option/8605694.article
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