Overview

Four current and former British Airways executives recently went on trial accused of having colluded with Virgin Atlantic to fix the price of fuel surcharges on passenger flights. BA has already been fined £121.5m by the OFT and $300m by US authorities for breaches of competition law but the trial represents the first case in the UK in which individuals stand accused of criminal conduct in respect of competition law. If found guilty, they face up to five years in jail and/or an unlimited fine.

The case highlights the growing risks faced by company directors in the field of competition law, in addition to the ever more onerous statutory obligations they have to contend with in other areas. As far as competition law is concerned, directors not only face imprisonment for cartel behaviour but also the prospect in the future that they may be more likely to be disqualified from acting as a director if their company breaches UK or EU competition law.

Disqualification is a very serious and effective sanction as it affects the livelihood of the individuals concerned. If disqualified, individuals cannot be involved in the promotion, formation or management of any company and doing so would itself constitute a criminal offence. What’s more, if acting in breach of a Competition Disqualification Order (CDO), an individual can be personally liable for all the relevant debts of that company.

In this briefing, we look at CDOs and the implications for you and your fellow directors of the OFT’s proposed changes to circumstances in which they will be used.

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