CMA announces first disqualification of director for price fixing

The Competition and Markets Authority has announced a disqualification of a company director found to have infringed competition law. This is the first time that the CMA has used its powers under the Company Directors Disqualification Act to disqualify a director of a company that infringed competition law.

In August 2016 the CMA found that Trod had infringed competition law by agreeing with a competing online seller that the parties would not undercut each others’ prices for posts and other goods sold on Amazon’s websites.  The CMA fined Trod £163,371.

The CMA considers that Daniel Aston the managing director of Trod contributed to the breach of competition law which makes him unfit to be a company director.  As such, the CMA has exercised its powers to seek a disqualification undertaking from him not to act as a director of any UK company for five years.

Disqualification is a serious tool in the CMA’s armoury to deal with competition law breaches and five years is a considerable period. It is not the longest period of ban and the CMA could have sought a ban of up to 15 years. What is more interesting perhaps is the question about whether the sanction was proportionate in this case and whether the case will set a precedent for similar enforcement action against individuals in the future.

Source: CMA press release 1 December 2016