Category Archives: Cartel investigations

Busy October for OFT criminal prosecutions

Whilst the OFT has suffered considerable criticism for its failures in prosecuting criminal cartel cases under Part 6 of the Enterprise Act 2002, it has been quietly developing its criminal prosecution track record in what might be seen as the less glamorous (but nonetheless important) field of consumer protection.

Should the SFO rush in to prosecute the banks over LIBOR?

In the wake of Barclays being hauled over the coals by a parliamentary committee, the Serious Fraud Office (SFO) has announced that it will open an investigation to probe untoward conduct by any of the 16 banks who were on the LIBOR panel during 2008. But the SFO would be wise to tread very carefully and make sure that, before it rushes in, it has the necessary sharp teeth to do so effectively. Whilst it clearly has the power to prosecute, the legal terrain upon which to bring a case is challenging. An ignominious failure to convict a banker after an inevitable high-profile trial would stain the reputation of its new director and spark fresh calls for its abolition. The last time the SFO brought a case which alleged price-fixing (R v Goldshield), it misunderstood the law so badly that the case collapsed at the first hurdle.

Removing the dishonesty element from the criminal cartel offence – not such a bad idea after all?

On 15 March 2012 BIS published its plans for an overhaul of the UK’s competition laws and enforcement arrangements. One aspect of these plans concerns the reform of the criminal cartel offence, s188 of the Enterprise Act 2002. The key proposal is to remove the dishonesty criterion so that the offence would be committed by those who agreed to price-fix, bid-rig or limit supply with another participant (purportedly a competitor) without revealing this to the public. This proposal has been widely criticized by competition and criminal lawyers, who have denounced it for its apparent illiberality and injustice. Despite this opposition, I crawl out onto a narrow and perilous ledge of assent to what BIS wants to do.

Negotiated justice – a light at the end of the tunnel for both sides?

The Solicitor General is conducting a preliminary consultation about the way in which an English version of Deferred Prosecution Agreements (DPA’s) might work. This is good news because such agreements do have a valuable role to play in law enforcement where investigation budgets are tight and it is also good news for companies who often need a way out of a costly and uncertain criminal investigation. But the debate must be fully informed. The public needs to know what is being contemplated.

Proposed changes to criminal cartel offence – a good thing?

Are proposed changes to the criminal cartel offence a good thing? BIS published a consultation paper on 16 March 2011 containing its proposals for amending the criminal cartel offence introduced by the Enterprise Act 2003. The paper does not propose changing the status quo whereby only an individual, not a company, can commit the offence. At the moment, to obtain a conviction, the OFT must prove not only knowing participation in cartel conduct but also dishonest participation. The paper outlines four options for what should replace this dishonesty element.