GoodCorporation urges OFT to go even further to enforce anti-comptetitive activity

The OFT has published revised guidance on director disqualification orders, indicating that directors will face tougher disqualification penalties if their businesses are involved in anti-competitive behaviour.

Directors found to have been involved in anti-competitive activities or who ought to have known what was going on, will face the prospect of a 15-year ban from acting as a director.

While any action to enforce legislation that prevents anti-competitive behaviour should be welcomed, it should also be acknowledged that the more important goal is to change corporate culture to ensure that anti-competitive activities, such as price-fixing cartels, are not even contemplated.

Consequently, the penalties for breaching competition laws should have ramifications for the company as a whole. If the consequences of anti-competitive activities affect only certain individuals, then where is the incentive for collective board responsibility to ensure transparency and compliance in this area?

The OFT should seek to impose sanctions such as tendering bars to drive a real cultural change. These should be for a limited period, to minimize the negative impact on the workforce, while still having the teeth to restrict the progress and performance of the business.