LEGISLATION


DAWN RAIDS FOR ANTI-COMPETITIVE BEHAVIOUR UNDER NEW LAW


With only weeks to go until it receives Royal Assent, businesses were urged by speakers at a Birmingham seminar to take heed of new Competition Act. Wragge & Co' s EU and Competition Law group hosted the seminar attended by over 140 people on the new Competition Act which is set to radically change exist ing UK competition laws. Companies breaking proh ibitions


on anti-


competit ive agreements or abusing market power will find themselves subject to 'dawn raids' and even fines of up to 10 per cent of their UK turnover. One of the speakers, Chairman of the CBI Competition Panel, Rufus Ogilvie Smals, spoke on the impact on business and highlighted the need for businesses to be aware of the provisions of the new Act.


In add ition to a fine, any parties adversely affected by the anti-competitive behaviour could also sue a company breaching the prohibitions for damages.


Front: Rufas Ogilvie Smals, Chairman of the CBI Competition Panel. Left to right: Carole Begent, Office of the Rail Regulator. Guy Lougher, Wragge & Co.Nick Montague, Office of Fa i r Trading .


Agreements that breach the prohibitions may even be void and unenforceable. In order to enforce the Act, the competition authorities in the UK will have the power to launch so-called 'dawn raids' . They will be able to enter a company's premises without notice and access any documents including diaries, expense accounts and even telephone messages. Employees could be required to give on-the-spot explanations on the contents of any documents produced.


Guy Laugher, head of EU and Competition Law group at Wragge & Co (who wrote an article in the last edition of LUBE) said : "The level of attendance indicates the considerable interest that business has in the new Act and the significant level of concern about how it will impact upon their activities. All companies have no choice but to take heed of the new rules and the extensive powers of investigation and enforcement that the competition authorities will have under the Act. Companies should already be assessing what impact the Act will have on their commercial agreements and behaviour. They should start now to take steps to comply with the Act's requirements."


Rufas Ogilvie Smals, Chairman of the CBI Competition Panel said: "Such major changes in UK competition law can have a paralysing effect on business unless properly understood. "


CROWN COURT RULES AGAINST ENVIRONMENT AGENCY'S "MANIFESTLY UNFAIR AND OPPRESSIVE" CHARGES


Petrus Oils, the UK's leading oil recycling business, today confirmed that it had been awarded costs in the Crown Court and exonerated from charges brought by the Environment Agency. His Honour Judge Tanking ruled in September 1998 at Stoke Crown Court that the charges against the company, of acting in breach of the conditions in their authorisation issued by the Agency, should be dismissed on the grounds that the prosecution brought by the Environment Agency was 'manifestly unfair and oppressive'. Normally costs of a successful defendant in a criminal trial are reimbursed to them out of central funds. Last week the Judge made an order that the costs incurred by Petrus should he paid directly by the Agency out of their own funds because he was satisfied that the company had incurred these costs as a result of the improper acts of the Agency.


Commenting on the judgement and the award of costs, Chris Williamson, managing director, Petrus Oils, said: "We have been unfairly harassed and hounded by the full might of the Environment Agency for the last two years. Starting with a prohibition notice after only three days of start-up and the threat of prosecution after only two months, their weapons of last resort were used as a first line of attack "Harassment became a daily occurrence in the weeks leading up to the trial in September this year. This harassment has increased since the trial ended nearly two months ago. These recent actions on their part can only be regarded as sour grapes. Unfortunately, the taxpayer suffers. "I would urge the Government to seriously inspect the machinations of the instrument to which it has entrusted our environmental security."


ISSUE 35 • DECEMBER 1998


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