{"id":14168,"date":"2023-07-18T12:30:13","date_gmt":"2023-07-18T12:30:13","guid":{"rendered":"https:\/\/www.theukrules.co.uk\/?page_id=14168"},"modified":"2023-10-11T04:35:26","modified_gmt":"2023-10-11T04:35:26","slug":"manage-risk","status":"publish","type":"page","link":"https:\/\/www.theukrules.co.uk\/rules\/business\/setting-up\/anti-competitive-practices\/manage-risk\/","title":{"rendered":"Manage Competition Law Risk with Good Business Practice Policies"},"content":{"rendered":"<h2>Compliance Makes Good Business Sense<\/h2>\n<p>You will need to manage risk to comply with all the laws of competition &#8211; and it is good business practice too.<\/p>\n<p>Long-term compliance makes business sense for more than one important reason, such as:<\/p>\n<ul>\n<li>You avoid the risk of financial penalties and being sued (or a prison sentence up to 5 years).<\/li>\n<li>You avoid risking significant damage to your company reputation.<\/li>\n<\/ul>\n<p>There is one overriding objective behind UK competition law. It is to protect consumers and businesses from anti competitive behaviour. Thus, the regulation safeguards effective competition in the United Kingdom.<\/p>\n<p>The aim is to allow for, and encourage, open and dynamic markets. Enhanced productivity and innovation results in value for customers.<\/p>\n<p>That is why all businesses must take steps to <a href=\"\/rules\/business\/setting-up\/anti-competitive-practices\/\">avoid anti competitive activity<\/a>. There are serious consequences for non-compliance. The penalties apply to individuals, company directors, and to businesses of all sizes.<\/p>\n<p>So, what can business owners do to manage risk? Besides the owners, people who run it are also responsible. To ensure your organisation avoids breaking competition law, you should:<\/p>\n<ul>\n<li>Identify where your business is at risk and evaluate the seriousness of any such risks.<\/li>\n<li>Set up policies, procedures, and guidelines (e.g. staff training on communicating with competitors).<\/li>\n<\/ul>\n<p><\/p>\n<hr>\n<p><\/p>\n<h2>Is Your Business Compliant or at Risk?<\/h2>\n<p>There are ways to work out whether your business may be at risk of breaching competition laws. As a rule, you would be at risk if:<\/p>\n<ul>\n<li>You (or your staff) have contact with any of your competitors. Typical examples may be at conferences or trade association meetings.<\/li>\n<li>Your company <a href=\"\/rules\/business\/setting-up\/anti-competitive-practices\/types-of-activity\/\">holds a position of dominance<\/a> in any given market where you carry out the business.<\/li>\n<li>Your staff members move to (or from) jobs with your business competitors on a regular basis.<\/li>\n<li>You have partnership agreements with your competitors (e.g. joint buying or joint selling) or long-term exclusive contracts with customers or with suppliers.<\/li>\n<\/ul>\n<p><strong>Note<\/strong>: Any lawsuits for damages, and the <a href=\"\/rules\/business\/setting-up\/anti-competitive-practices\/\">penalties for anti-competitive behavior<\/a>, would still apply even if your senior managers were not aware of the illegal activity.<\/p>\n<p><\/p>\n<hr>\n<p><\/p>\n<h2>Setting Up Policies and Staff Training<\/h2>\n<p>As a rule, the responsibility for setting up guidelines would rest with a senior member of staff. So for example, a director could set up company policies and procedures. Someone must ensure that employees know how to <a href=\"\/rules\/business\/setting-up\/anti-competitive-practices\/\">avoid and report anti-competitive activities<\/a>.<\/p>\n<p>The Competition and Markets Authority (CMA) produces further guidance for businesses. You can read more about <a href=\"https:\/\/www.gov.uk\/government\/publications\/competition-law-risk-a-short-guide\" target=\"_blank\" rel=\"noreferrer noopener\">competition law risk<\/a> and how to comply with fair trading regulations.<\/p>\n<p><\/p>\n<hr>\n<p><\/p>\n<h2>OFT Leniency and Informant Rewards<\/h2>\n<p>A business or an individual can come forward to report their own involvement in a cartel. Doing so may get their financial penalty reduced. In some cases, you may avoid the penalty altogether (according to the CMA leniency programme).<\/p>\n<p>Even so, to qualify for any leniency, applicants must:<\/p>\n<ul>\n<li>Admit their involvement in anti competitive practices.<\/li>\n<li>Cooperate in full with the CMA investigation.<\/li>\n<li>Stop their involvement with immediate effect.<\/li>\n<\/ul>\n<p>The CMA may offer a financial reward for information about cartel activity. They call them &#8216;informant rewards&#8217;. Individuals who come forward with information on an involvement in a cartel may get immunity from criminal prosecution. They call it a &#8216;no-action&#8217; letter.<\/p>\n<p>You can contact the CMA cartels hotline if you suspect someone is infringing the competition law:<\/p>\n<p><strong>Competition and Markets Authority Cartels Hotline<\/strong><br \/>\n  Telephone: <a href=\"tel:02037386888\">020 3738 6888<\/a><br \/>\n  Email: <a href=\"mailto: cartelshotline@cma.gsi.gov.uk\">cartelshotline@cma.gsi.gov.uk<\/a><\/p>\n<p><\/p>\n<hr>\n<p><\/p>\n<div class=\"content-inner-block\">\n<h4>ALSO IN THIS SECTION<\/h4>\n<p><a href=\"\/rules\/business\/setting-up\/anti-competitive-practices\/types-of-activity\/\">List of Anti Competitive Practices<\/a> | Illegal activities to avoid in business, such as &#8216;cartels&#8217; and bid rigging.<\/p>\n<p><a href=\"\/rules\/business\/setting-up\/anti-competitive-practices\/report-activity\/\">Reporting Anti-competitive Activities<\/a> | How to report a cartel or other anti-competitive activity to CMA.<\/p>\n<\/p><\/div>\n<p><\/p>\n<hr>\n<p><\/p>\n<div class=\"updated-data\">\n    <strong>Managing a Risk Based Approach to Anti Competitive Activities<\/strong><br \/>\n    <time datetime=\"2022-01-01\">Last Updated 2022<\/time>\n  <\/div>\n","protected":false},"excerpt":{"rendered":"<p>Compliance Makes Good Business Sense You will need to manage risk to comply with all the laws of competition &#8211; and it is good business practice too. Long-term compliance makes business sense for more than one important reason, such as: You avoid the risk of financial penalties and being sued (or a prison sentence up&hellip; <a class=\"more-link\" href=\"https:\/\/www.theukrules.co.uk\/rules\/business\/setting-up\/anti-competitive-practices\/manage-risk\/\">Continue reading <span class=\"screen-reader-text\">Manage Competition Law Risk with Good Business Practice Policies<\/span><\/a><\/p>\n","protected":false},"author":2,"featured_media":0,"parent":2447,"menu_order":0,"comment_status":"closed","ping_status":"closed","template":"","meta":{"inline_featured_image":false,"footnotes":""},"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v22.2 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Manage Competition Law Risk with Good Business Practice Policies - UK Rules<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.theukrules.co.uk\/rules\/business\/setting-up\/anti-competitive-practices\/manage-risk\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Manage Competition Law Risk with Good Business Practice Policies - UK Rules\" \/>\n<meta property=\"og:description\" content=\"Compliance Makes Good Business Sense You will need to manage risk to comply with all the laws of competition &#8211; and it is good business practice too. 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