West Midlands lawyers are being asked to help promote awareness of new competition law compliance materials to their business clients.
Over 130 law firms headquartered in the West Midlands 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 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.
The CMA selected the West Midlands as the first region to receive this assistance following an independent research report, which found that understanding of competition law in the West Midlands is lower than across the UK, specifically:
- only 12% of businesses in the West Midlands acknowledged that they were familiar with competition law, the poorest figure compared with the rest of the UK ( versus 23% nationally)
- the region’s firms were among the least likely to discuss competition law at senior level, 11% of businesses in the West Midlands have had senior level discussions about competition law (19% nationally)
- only 1% of businesses in the West Midlands have had training on competition law (6% nationally)
- 43% of businesses in the West Midlands understood that agreeing prices, in order to avoid losing money, was illegal (55% nationally)
- 39% of businesses in the West Midlands knew that price-fixing could lead to imprisonment (53% nationally)
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.”