ISSUES
: Business and Trade
Chapter 2: Corporate responsibility
31
New guides for business owners in the
dark over competition law
Three-quarters of company bosses don’t understand competition rules.
By Rebecca Burn-Callander
C
ompany bosses won’t be
able to claim ignorance over
competition law from today,
after an industry watchdog published
a series of guides around how to
avoid being embroiled in price-fixing,
bid-rigging and market-sharing.
The Competition & Markets Authority
(CMA) created the materials following
research earlier this year, which
found that 77% of UK firms did not
understand competition law.
The move has been welcomed by the
Federation of Small Businesses (FSB),
which said that competition law was a
“crucial” topic for the nation’s small-
and medium-sized firms.
“We welcome efforts to help small
businesses grasp the law in this area
– as the potential fallout of getting it
wrong could be severe,” said FSB
national chairman John Allan.
“Competition law is a crucial part of
doing business in the UK and
these films are a useful tool
to help raise awareness of
this complex topic.”
Although 55% of the
company bosses surveyed
by theCMAknewprice-fixing
was illegal, 27%were unsure
whether it was acceptable
to agree prices with rivals,
23% thought it was “okay
to discuss prospective bids
with competing bidders” and
29%were not aware whether
bid-rigging was illegal.
The CMA has written
an at-a-glance guide to
competition law, a series of
case studies about firms that
have broken the law, and
created a series of short films
flagging illegal practices, to
prevent small firms either
becoming a victim of crime
or perpetrating one.
There are eight animated films in
total, and business owners can test
their knowledge with a new quiz.
“We have worked closely with
groups
representing
small
businesses to learn more about
what they do and don’t know about
competition law and they told us
they need information that is short,
simple and easy-to-use,” said
Alex Chisholm, the CMA’s chief
executive.
“These new materials explain which
behaviours are illegal, and why they
cause harm. The victims of anti-
competitive activity will often be
other businesses, so knowing what
illegal behaviour looks like and how
to report it can help businesses
protect themselves from others
which are acting unfairly.”
The potential consequences of
breaking the law are very serious. In
August, Consultant Eye Surgeons
Partnership was fined £500,000 by
the CMA after it admitted several
infringements around price-fixing.
Companies found to be in breach
of competition law can be fined up
to 10% of global turnover and their
directors may be disqualified from
managing a company for up to 15
years.
Some breaches may be criminal
offences, which can result in
individuals being jailed for up to five
years.
18 November 2015
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The above information is
reprinted with kind permission
from
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