Contribution from Adam Aldred

A response to the BCLWG Provisional Conclusions and Recommendations from Adam Aldred, a barrister at Kings Chambers.

May 23, 2017

Thank you all for the work you have been doing on this project and for organising the event at BIICL [on 2 May 2017].

I raised a point during a discussion session regarding Competition Disqualification Orders (CDOs).

My point put simply is that if reference is to be made to the UK’s Cartel Offence, your report should also deal with CDOs.

Both CDOs and the Cartel Offence enable the imposition of sanctions on individuals in the UK for violations of competition law.  The Cartel Offence  (s188 EA02 as amended) is firmly anchored to conduct and effects within the UK by the repeated use of the words “in the United Kingdom”.  However, unlike the Cartel Offence, the legislation establishing CDOs expressly includes within its scope breaches of EU competition law (see below).  Thus, it seems to me, there is even more imperative to deal with CDOs in a post Brexit world than is the case with the Cartel Offence.

Competition disqualification orders

EA02 modified the Company Directors Disqualification Act 1986 (CDDA) and introduced CDOs.

Section 9A of the CDDA sets out two conditions which must be satisfied for a court (the High Court or the Court of Session in Scotland) to make a CDO in respect of an individual director:

  • An undertaking, which is a company of which the individual is a director, commits a breach of competition law; and
  • The court considers that the individual’s conduct as a director makes him unfit to be concerned in the management of a company.

The court must make a CDO against a person if it considers that both those conditions are satisfied.

A CDO once made is much the same as any other disqualification order under the CDDA. The maximum period for disqualification under a CDO is 15 years.

Importantly for present purposes:

  • A breach of competition law for the purposes of a CDO is an infringement of CA98 Chapter I or Chapter II or TFEU Article 101 or 102 (CDDA, section 9A(4)).
    Also, CA98 section 60 is expressly applied for the purposes of assessing in a CDO whether there has been an infringement under CA98 (CDDA, section 9A(11)).


If your report refers to the Cartel Offence, I believe you should also deal with CDOs, given

  1. the CDDA expressly refers to TFEU Articles 101 and 102 and CA98 section 60,
  2. both are used in the U.K. for deterrence purposes,
  3. both help make the UK’s leniency regime more attractive (re: the Cartel Offence – a successful immunity applicant can expect no-action letters for its directors and staff; re: CDOs – all the directors of any successful immunity/leniency applicant will not face CDOs), and
  4. any defence available with regard to the Cartel Offence would probably be available to a director facing a CDO.

In your report, you could adopt a light touch. Perhaps something as simple as:

“We consider that, post Brexit, Competition Disqualification Orders as provided for in section 9A of the Company Directors Disqualification Act 1986 (as amended) should remain available for deterrence purposes.  However, we consider the power of the CMA and sectoral regulators to apply for a CDO against an individual director should be based on infringements of UK competition law only.”