Australia: "It’s criminal!" The criminalization of antitrust continues across the world

It is a well-known feature of antitrust (or competition) law in the United States that violations carry criminal penalties, which are borne by individuals directly involved in anti-competitive conduct. Senior executives and employees of corporations who have facilitated serious anti-competitive agreements often face lengthy jail sentences and/or substantial personal fines in the US. The US aspects of the on-going global investigations into price fixing in automotive components have, for example, resulted in four Japanese nationals – executives of Yazaki – being sentenced by US courts to prison sentences ranging from 15 months to two years.10

Until relatively recently, however, competition laws elsewhere in the world did not carry criminal penalties. Under EU competition law, which has been in place for over 50 years, businesses that engage in anti-competitive agreements or conduct can face substantial (administrative) fines, but individuals are not fined, let alone subject to imprisonment.

Yet this is changing, and in recent years a number of major antitrust jurisdictions across the world have acquired a criminal law component. In the past few months alone, there have been significant developments in that respect in the UK, Belgium and New Zealand.


At one level, it might be seen as intrinsic to the most basic kind of anti-competitive agreement – competitors agreeing fixed prices, or allocating product markets or territories as between themselves – that it should be regarded as a crime. In the famous formulation of Adam Smith, the great 18th-century economist, when competitors agree on a "contrivance to raise prices", that is "a conspiracy against the public".11 There is, arguably, a sense in which an anti-competitive agreement, say, to fix prices is a form of fraud against the participants' customers: the parties are pretending to the customers that they are selling goods at a price that is a result of market competition, whereas in fact the price is a higher price resulting from collusion between them. Indeed, a decade ago, an attempt was made in the UK to prosecute companies for alleged price-fixing in generic medicines on the basis of the English common law offence of "conspiracy to defraud", although the criminal charges in this case were quoshed after the (then) House of Lords limited the basis on which any case could proceed.12

Moreover – moving from the theoretical to the practical - it is thought that, if individual executives and employees face personal liability for serious anti-competitive agreements (rather than the liability attaching only to the companies they work for), this will concentrate their minds and deter them far more effectively from involvement in such anti-competitive agreements. In turn, greater deterrence should result in fewer anti-competitive agreements, which is to the benefit of consumers and the economy generally. As the UK Government stated when it first proposed a criminal offence for seriously anti-competitive agreements:

"The threat of a criminal conviction and the possibility of a prison sentence means that individuals are more likely to think very carefully before engaging in cartels. Or, if they are directed to do so by their managers, they may be far more willing to inform the authorities."13

United Kingdom - toughening the cartel criminal offence

For a decade, the UK has had a criminal offence for cartels. Individuals directly involved in the most serious kind of agreements between competitors – price fixing, output limitation, market sharing or bid-rigging – can be convicted of a criminal offence, with penalties of up to five years' imprisonment and/or substantial personal fines.

In the decade since the introduction of this "cartel offence", however, only two prosecutions have been brought and only one of these has resulted in a conviction – the prosecution relating to the marine hoses cartel (which was also being prosecuted in the United States), as a result of which three executives were imprisoned for periods ranging from two-and-a-half to three years.

The relative paucity of prosecutions under the UK criminal offence for cartels has had the effect, of course, that the deterrent effect of the offence is correspondingly weakened; if there are very few prosecutions, people think that there is only a remote risk of facing criminal penalties.

There has been a belief, within the UK Government and within the UK competition authorities, that the low level of prosecutions under the UK's "cartel offence" is, at least partly, attributable to the high statutory threshold for bringing prosecutions under the offence as formulated: namely, that the prosecution needs to prove not only that the individual was directly involved in the agreements concerned, but also that the individual acted "dishonestly". The concept of "dishonesty" in this context has been thought by the UK competition authorities to be vague, problematic and difficult to establish.

As a result, new UK competition legislation – the Enterprise and Regulatory Reform Act 2013, which will take full effect on April 1, 2014 – has sought to toughen the offence by removing the need to establish "dishonesty". Mere participation in the agreement concerned is sufficient to constitute commitment of the offence.

However, by way of counter-balance to provide some protection against the new tougher offence being applied in an excessively draconian fashion, the new legislation also contains a range of new exclusions and defences:

  • Broadly speaking, an individual will not be liable under the offence if the anti-competitive agreement has been disclosed to customers or potential customers, or to the competition authorities, or has been published. Thus it is only secret anti-competitive agreements that will give rise to criminal penalties.
  • It will also be a defence if an individual concerned can show that, before making the agreement, he or she took reasonable steps to disclose the nature of the agreement to his or her legal advisers. This defence will apply even if the legal advice was that the agreement is anti-competitive – offering potentially a loophole to individuals involved in serious anti-competitive agreements.

Belgium – new Competition Act

In September 2013, Belgium's new Competition Act entered into force, as part of the country's new Code of Business and Economic Law. One innovation is that it will now be possible to impose fines on individuals, as well as on companies, for cartel infringements. Personal fines will be up to a level of €10,000 (about GB £8,350 or US $13,350).

New Zealand – new criminal offence for cartels

There are comparable developments in New Zealand, where proposed legislation is under consideration – the Cartel Criminalisation Bill. This is to provide that individuals directly involved in the most serious kinds of anti-competitive agreement – price-fixing, market-sharing, output limitations and bid-rigging – will face criminal penalties, including up to seven years' imprisonment.

The legislation is controversial, and debate continues on some of the aspects that have also been the subject of controversy in the UK, such as whether it will be a defence to show that an individual honestly believed that his or her conduct was reasonably necessary for the purpose of legitimate collaborative activity.

Meanwhile, in the US...

At the same time as Britain, Belgium and New Zealand are in adopting or toughening legislation on criminal sanctions for serious anti-competitive behaviour, in the United States – the birthplace of criminal antitrust law – the rules are being applied with ever-increasing severity. In 2013, the Antitrust Division of the US Department of Justice announced that:

  • the percentage of individuals convicted who are sentenced to imprisonment in the US has increased from 37 per cent in the 1990s to 71 per cent in the period 2010-2012
  • the average prison sentence for those individuals has increased from 8 months in the 1990s to 25 months in 2010-201214.

As shown by the example of the Japanese executives imprisoned by US courts in the automotive components cartel case (see above), the reach of US antitrust law is such that it needs to be a concern for any individuals around the world whose products are sold (directly or indirectly) on US markets.

In short

The reach of criminal enforcement for anti-competitive agreements grows ever wider around the world, and the laws are applied with ever-increasing severity. There is every incentive – for individuals as well as for companies – to ensure that their conduct is compliant with antitrust and competition law.


10 US Department of Justice press release, "Yazaki Corp, Denso Corp and Four Yazaki executives agree to plead guilty to automobile parts price-fixing and bid-rigging conspiracies," January 30, 2010.
11 Adam Smith, The Wealth of Nations, Book I, Chapter 10, Part II.
12 See, for example, UK House of Lords judgment, R v GG [2008] UK HL 17.
13UK Department of Trade and Industry, Productivity and Enterprise: a world class competition regime, Cn 5233, July 2001, paragraph 7.16.
14US Department of Justice Antitrust Division, Division Update Spring 2013.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:
  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.
  • Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.
    If you do not want us to provide your name and email address you may opt out by clicking here
    If you do not wish to receive any future announcements of products and services offered by Mondaq you may opt out by clicking here

    Terms & Conditions and Privacy Statement (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

    Use of

    You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


    Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

    The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


    Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

    • To allow you to personalize the Mondaq websites you are visiting.
    • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
    • To produce demographic feedback for our information providers who provide information free for your use.

    Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

    Information Collection and Use

    We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

    We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to with “no disclosure” in the subject heading

    Mondaq News Alerts

    In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


    A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

    Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

    Log Files

    We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


    This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

    Surveys & Contests

    From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


    If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


    From time to time Mondaq may send you emails promoting Mondaq services including new services. You may opt out of receiving such emails by clicking below.

    *** If you do not wish to receive any future announcements of services offered by Mondaq you may opt out by clicking here .


    This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to

    Correcting/Updating Personal Information

    If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to

    Notification of Changes

    If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

    How to contact Mondaq

    You can contact us with comments or queries at

    If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at and we will use commercially reasonable efforts to determine and correct the problem promptly.

    By clicking Register you state you have read and agree to our Terms and Conditions