ABSTRACT
The practical importance of ensuring that competition laws are complied with cannot be underestimated.39 Any undertaking must be aware of the potential impact of both national and Community competition rules. The laws of, for instance, other Member States or the US may be applicable to the activities of UK-based companies. This can affect an organisation in all aspects of its activities, such as its form of contracting for distribution and purchasing, any pricing policies adopted, its responses to competition in the market, any governmental funding acquired and also the purchase of assets or shares of another organisation. The implications of a lack of awareness or the inability to deal with the effect of competition law are significant. A restriction in an agreement for the distribution of products may be null and void. Governmental aid may need to be refunded with interest. A past takeover may be unravelled and fines may be imposed. A planned takeover may be prevented by the authorities. Parties may be required to divest certain assets for a merger to proceed or to give commitments as to future pricing and market behaviour. An undertaking may be ordered, either by a court or a competition authority, to resume supplies to a competitor. The European Commission can impose fines of up to 10% of an undertaking’s worldwide turnover, a very significant and practical threat, in addition to imposing daily penalties for noncompliance with Arts 81 and 82 EC. Damages, and interim remedies, can be sought in the national courts in respect of breaches of Arts 81 and 82 and illegally provided State aid. The position is similar under the Competition Act 1998. For all of these reasons it is necessary for a company to establish an effective compliance programme and ensure that its directors and employees are both aware of competition law’s existence and adequately prepared to follow it.
