Competition and Enterprise
Competition Act 1998
This legislation came into force on 1st March 2000 and prohibits anti-competitive agreements and practices and the abuse of dominant market positions. The Office of Fair Trading (“OFT”) has the power to impose financial penalties and prohibitions, and enjoys wide powers to investigate cartels, market position abuse breaches and monopoly investigations. These can include the power to require the production and explaination of documents and to allow for the entering of premises without a warrant. In certain circumstances, a failure to comply with elements of an investigation or to obstruct or interfere with an investigation constitutes a criminal offence.
The OFT does operate a leniency programme, which applies to agreements between undertakings. This scheme provides that, where an undertaking is involved in agreements that concern price-fixing, bid-rigging, the setting of restrictions or quotas of output or market sharing, then an immunity from financial penalty or a reduction of that penalty might be extended if the undertaking comes forward and cooperates.
Enterprise Act Offences
The Enterprise Act 2000 came into force on 20th June 2003 and relates to cartel-type agreements between individuals. A conviction for a cartel offence is punishable by a maximum sentence of 5 years' imprisonment, but there is a “leniency” programme and he OFT can issue a “No Action” letter against a person who reveals the existence of a cartel. The Act has also contemplates the disqualification of directors of companies where there have been breaches of competition law. The Enterprise Act provides the OFT with a number of investigative powers concerning the requirement to provide information or a document and to also allow for the entering of premises under warrant. A person made the subject of a requirement to provide information or an explanation or document should seek advice concerning this as the Act provides that a failure to comply is a criminal offence as are a number of acts which might obstruct or mislead an investigation. The Act also provides for the referral of a completed or anticipated merger to the Competition Commission and there are again criminal offences created for providing false or misleading information in an investigation into a merger referral or intentionally altering, suppressing or destroying documents where there has been a requirement to produce them.
OFT Investigations
The Office of Fair Trading is responsible for investigating anti-competitive practices. This can include, amongst other things, cartels, bid-rigging, or abuse of a dominant market position. Investigations can commence in circumstances where someone has acted as a whistle-blower or where someone involved in an activity such as a cartel comes forward in the hope of avoiding prosecution. The nature of these investigations is usually complex and often takes a substantial period of time to resolve.
Dawn Raids
The OFT has been given powers that enables it to arrive unannounced and to enter and search premises. This is part of the investigative phase where explanations can be sought and documents removed. It is essential that you are properly represented and we offer a 24-Hour service that you obtain practical and timely advice.
Interviews
In addition to those situations where the OFT place a requirement on a person to furnish them with information and documents, circumstances might arise where it is proposed to interview people under caution within the meaning of the Police and Criminal Evidence Act 1984. This would form part of any investigation with a view to possible criminal proceedings. The significance of these interviews is that the replies may be used in evidence in any subsequent Court proceedings and a failure to mention when questioned something later relied upon in defence might also lead to an inference being drawn.
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