Price fixers face up to 10 years' jail in new Bill

INDIVIDUALS AND companies convicted of price-fixing and similar crimes could face 10 years in jail and €5 million fines under proposed changes to the Republic’s competition laws.

The Government has published a new Competition (Amendment) Bill that proposes to increase sentences for serious offences and streamline the administration of the current regime.

However, the Bill does not propose allowing courts to impose civil fines for breaches of the anti-trust code, a measure to which the Republic is committed under the terms of the EU/IMF bail out deal agreed last year.

The Bill proposes increasing the maximum sentence for anyone convicted by a jury of offences such as price-fixing, bid-rigging or market sharing to 10 years from five years.

It also proposes increasing the maximum fines, which can be imposed on both individuals and businesses, to €5 million from €4 million. In addition, any convicted business could have to pay the costs of the investigation.

Under its terms, where a business is convicted of an offence, anyone taking a follow-on case in the civil courts will not have to prove all over again that the defendant breached competition law.

However, it does not allow the courts to impose civil fines for competition law breaches. The last Government committed itself to doing this when it signed up to the bailout deal last year.

According to Alan McCarthy, partner with law firm AL Goodbody, the civil fines proposal may have faced a number of constitutional barriers.

He explained that the burden of proof required for civil fines was “on the balance of probabilities”, but, as fines are seen under Irish law as a criminal sanction, the Constitution would still require the courts to apply the tougher “beyond a reasonable doubt” test.

Mr McCarthy acknowledged yesterday that the legislation’s main focus is on increasing the penalties for competition law offences, and particularly cartel activities, but he pointed out there were a number of changes that were welcome from an enforcement point of view.

He explained the Bill made it easier for both the Competition Authority and communications regulator, Comreg, to bring their own actions before the Circuit and High Courts to prevent anti-competitive behaviour.

Mr McCarthy pointed out the Republic had a strong record in enforcing anti-cartel laws, and was the first EU member state to successfully prosecute a competition law criminal offence in 2006 when a group of companies in the west of Ireland were convicted of fixing the price of home-heating oil.