DGFT spells out formal compliance policy

The Office of Fair Trading has drawn up a formal policy on compliance with the Competition Act 1998, which has 3 main features:

· a recommendation that all businesses take steps to ensure that they comply with the new legislation;

· an undertaking on the part of the Director General that he will take into account the existence of an effective compliance programme in determining the level of financial penalty to impose on a business which infringes the new law;

· the publication of advice on the features the Director General would expect to see in an effective compliance programme.

Message for small firms

Small firms are not immune from the need to comply with the new law. The Director accepts that formal or elaborate compliance programmes may not be feasible for small businesses. But he insists that even small firms have what he calls a knowledgeable workforce. This means that employees in relevant areas - like sales, marketing and purchasing - must be fully aware of the provisions of the new legislation and the implications of infringement.

Message for large firms

The Director's view is that the risk of infringing competition law is greater in large and diverse organisations. These firms should implement a formal compliance programme.

How can compliance be achieved?

Our guidance note on Compliance Programmes explains how to go about putting together a compliance policy, and its recommendations are in accordance with the official policy of the Office of Fair Trading. If you would like a hardcopy of the guidance note, please e-mail your request together with your name and address to [email protected]

For further information about the Competition Act and to see all of our Competition guidance notes, go to the Hot Topics section on this website.