The saying goes that ‘ignorance of the law is no excuse’, and competition law is no exception to that principle. As part of its drive to educate businesses on competition issues, the Competition and Markets Authority (CMA) has published a set of straightforward, tailored materials aimed at SMEs, including an ‘at-a-glance guide to competition law‘, case studies and a series of short, animated video guides. We’ve embedded the introductory guide, and if you’re unfamiliar with competition law issues the other videos (on issues such as price-fixing, market-sharing, abuse of dominance and resale price maintenance) are also worth a watch.
These educational efforts follow on from research the CMA commissioned last year into UK businesses’ understanding of competition law, which Stephen mentioned here. Some of the other findings outlined in that report included:
- Only 21% of micro and 26% of small businesses said they know competition law well.
- Understanding of specific anti-competitive behaviours was poor. For example, 60% of respondents did not know that agreements to share customers are illegal, while only 55% of respondents knew that price-fixing is illegal.
- Small businesses were very unlikely to have held any internal training sessions on competition law issues in the preceding 12 months (fewer than 10%, compared to 41% of large businesses).
Supplementary research showed that SMEs want to do the right thing, and tend to understand that certain anti-competitive practices are wrong, but the overall findings raised concerns that a lack of awareness among smaller firms could lead to them unintentionally falling foul of competition law, or prevent them recognising breaches by competitors.
Once firms have gone through the guidance materials, they can take a short quiz to review how much they’ve learned. As well as helping participants to consolidate their new-found knowledge, the quiz also serves as a tool for the CMA to assess the levels of understanding among different sized firms.
The CMA’s educational push goes hand-in-hand with their intention to take a harder line on competition law infringements, which Stephen covered in his post. We can generally be confident that, where the CMA turns its educational focus on a sector, that sector is also likely to be on their radar for enforcement purposes (on the basis that the most valuable lesson is making an example of someone who has failed to comply with the rules). SMEs should therefore treat these efforts as notice that the CMA will not just focus on catching the ‘big fish’.
If the CMA materials have rung alarm bells for you, or you are concerned about competition law compliance (or if you just want to get top marks on the quiz), please feel free to get in touch.
On January 5, 2016