A new crackdown is being launched by the UK’s competition
authority amidst a 30% rise in the number of tip offs about
cartels.
The increase follows a previous Competition and Markets Authority
(CMA) campaign targeting this illegal behaviour.
The CMA is now launching a new campaign to
encourage more people to come forward with information that will
help it hunt out illegal cartels. The campaign is part of a
ramping up of the CMA’s enforcement activity and comes after the
award of an extra £2.8m from the government for this work.
Cartels are businesses which cheat their customers by agreeing
not to compete with each other so that they can keep their prices
high. There are serious penalties for being in a cartel, but
many workers in the UK know little about them, putting them and
their companies at risk.
The new campaign encourages people to be “Safe, not Sorry” if
they think they may have involved themselves in cartel activity
and to make sure they are the first to report it to the CMA.
Witnesses – those not involved themselves but who have seen
something untoward – are also asked to “Do the Right Thing” by
reporting it to the CMA.
The CMA saw a 30% increase in tip offs in 2017, following the
launch of the CMA’s first digital campaign.
As part of the new campaign, the CMA is reminding people that, if
they come forward with information about their
involvement, they can receive significant reductions in
fines and avoid being disqualified from running a company. If
they are the first to come forward, they can receive total
immunity, including from criminal
prosecution. Witnesses who blow the whistle can receive a
reward of up to £100,000.
Stephen Blake, Senior Director for Cartels at the CMA,
said:
“We are committed to tackling cartels wherever we find
them. More people are reporting illegal activity to us and
we urge anyone with information to come forward. If you’re
involved, it’s better to be safe, not sorry and to tell us about
it first – before someone else does.
“For those who were not involved but have witnessed illegal
activity, we urge them to do the right thing. We know that
this is a sensitive issue and some people could worry about what
might happen to them if they speak to us. All information is
treated confidentially and we can discuss any concerns that
people may have over keeping their identity secret.”
Francesca West, Chief Executive at whistleblowing charity
Public Concern at Work, which is backing the “Safe, not Sorry”
campaign, said:
“We know from our experience that speaking up isn’t easy, but it
is often the only way to prevent further harm. It is encouraging
the CMA has seen a 30% rise in people coming forward to report
the illegal behaviour of cartels.”
Over the past two years, the CMA has issued £151m in fines
following successful investigations into anti-competitive
practices and it is currently investigating 15 cases where
competition law may have been broken.
The new campaign will target a range of industries that are at a
greater risk of cartels forming. These sectors include:
construction, manufacturing and business support services. These
are sectors that have either a history of reported cartel
activity or characteristics that make them vulnerable to cartels.
Recent cases where the CMA has taken enforcement action include:
-
Water tank firms fined
over £2.6 million, after they formed a cartel to divide up
customers and fix minimum prices for tanks used in large
construction projects (such as, schools and hospitals).
-
Somerset estate agents
fined over £370,000 for fixing the minimum prices of
their commission rates, meaning that local home owners were
denied a fair deal when selling their property.
-
Amazon marketplace
seller fined over £160,000 and director disqualified
from running a company after agreeing to fix the prices of
popular posters and frames with a competitor. The competitor
contacted the CMA to report the cartel activity and received
immunity.