The Competition Act 1991 was made law in Ireland to reflect European law in relation to the prevention, restriction or distortion of competition and the abuse of dominant positions in trade in the State.
The main thrust of the legislation was to attempt to restrict anti-competitive agreement decisions and concerted practices. Section Four of the 1991 Act provides "Subject to the provisions of this section all agreements between undertakings, decisions by associations of undertakings and concerted practices which have as their object or affect the prevention, restriction or distortion of company in trade in any goods or services in the State or in any part of the State are prohibited and void, including in particular, without prejudice to the generality of this subsection, those which -
| a) | directly or indirectly fix purchase or selling prices or any other trading conditions; |
| b) | limit or control production, markets, technical development or investment; |
| c) | share markets or sources of supply; |
| d) | apply dissimilar conditions to equivalent transactions with other trading parties thereby placing them at a competitive disadvantage; |
| e) | make the conclusion of contracts subject to acceptance by the other parties of supplementary obligations which by their nature or according to commercial usage had no connection with the subject of such contracts. |
Where in the opinion of the competition authority, an agreement decision or practice which might come within the above definition is actually of good effect, the competition authority can licence such activity and it may therefore be continued".
The recent amendment to the Competition Act of 1991 contained in the Competition (Amendment) Act of 1996, provides under Section Two that where an agreement decision or concerted practice of the above type is carried on, the undertaking concerned, which would include a limited liability company, is deemed to be guilty of an offence. It is further provided under the Competition (Amendment) Act of 1996, that where an undertaking has been licensed to pursue a certain activity and is in breach of that licence, such a breach will also be deemed to be a criminal offence.
Section Three (Four) (A) provides that where an offence has been committed under Section Two of the Act, and the offence has been: "authorised or consented to by a person being a director, manager or other similar officer of the undertaking, or a person who purports to act in such capacity" such a person will be guilty of an offence along with the undertaking and can be prosecuted and punished in the same manner as the undertaking.
It should be noted that the provisions of this Act create personal liability for directors of a criminal nature, but such liability is not limited exclusively to directors, it should be noted that people in management roles in companies, even if not designated as directors, can also be criminally liable.
Section One of the Competition (Amendment) Act of 1996, defines a director as INCLUDING "a person in accordance with whose directions or instructions the directors of the undertaking concerned are accustomed to act but does NOT include such a person if the directors are accustomed so to act by reason only that they do so on advice given by the person in a professional capacity".
Section Three of the Act sets out that on summary conviction ie. prosecution in the District Court, the undertaking or 'director' can be punished by a fine of not more than £1,500 or a prison sentence of not more than six months.
By prosecution on indictment ie. in the Circuit Court by Judge and Jury, the fine cannot exceed three million pounds or ten percent of the turnover of the undertaking in the financial year ending in the twelve months prior to conviction. In the case of individuals, including directors, the fine is the same amount or a prison sentence of not more than two years. It should also be noted, that if after conviction the offence continues, they will be deemed to be further offences on each day that the contravention continues.
It should be noted that, since the competition authority has been set-up in this jurisdiction, that they have been very active and very effective in their implementation of the competition rules in this country and it can only be presumed that the implementation of the Competition (Amendment) Act of 1996 will be carried out with the same zeal and efficiency as heretofore.