Lawyers in Wales are being asked to help promote awareness of new competition law compliance materials to their business clients.
Over 60 law firms headquartered in Wales will be contacted by the Competition and Markets Authority (CMA), and encouraged to share the CMA’s easy-to-use competition law information with their small and medium-sized enterprise (SME) clients.
The information, which is available in Welsh and English, is intended to help SMEs recognise anti-competitive practices, comply with competition law and report suspicions of illegal anti-competitive activity.
The approach is part of the CMA’s ongoing drive to boost awareness of, and compliance with, competition law, following the launch of its competing fairly in business: advice for small businesses materials.
As well as contacting lawyers, the CMA will also be meeting with business representatives in order to explain the importance of competition and consumer law issues affecting Wales, ahead of its board meeting in Cardiff on 20 October.
Research shows that businesses’ understanding of competition law in the area is low:
- Only 57% of businesses in Wales knew that price-fixing is illegal.
- Only 25% of businesses in Wales knew that it’s unlawful to set the price at which others can re-sell their product.
- Only 12% of businesses in Wales knew that admitting to participation in a cartel can lead to immunity from a penalty.
The consequences of breaching competition law can be severe:
- Businesses can be fined up to 10% of their annual turnover.
- Company directors can be disqualified from managing a company for up to 15 years.
- People involved in cartels can face up to 5 years in prison.
The CMA has also commissioned further research which revealed that most small businesses have a shared ethical sense that certain anti-competitive practices, such as price-fixing, are unfair or wrong and want to do the right thing.
Ann Pope, CMA Senior Director of Antitrust Enforcement, said:
“The victims of anti-competitive activity can often be other businesses, so knowing what illegal behaviour looks like and how to report it can help small and medium-sized businesses protect themselves.
The potential consequences of breaking the law are very serious. That is why it is important that all businesses know what to look out for and report suspected breaches to the CMA.
Legal advisers to SMEs are ideally placed to help raise awareness of competition law among their clients.”