This week the Office of Fair Trading (OFT) charged three executives in the marine hose sector with cartel offences under the Enterprise Act 2002.

It is the first time the OFT has exercised these powers since the cartel offence came into force in June 2003. The move follows an 11-month investigation by the OFT as well as investigations by the US Department of Justice and the European Commission.

Wragge & Co antitrust partner Bernardine Adkins says, "Many competition specialists thought the OFT would target a household name for its first prosecution. It isn't really a bold move to follow the US and EU and pick off an easy target like this one. But it shows the OFT is willing to use its powers, so it serves as a useful reminder that no company or its employees can afford to ignore antitrust rules."

Earlier this month, the three men reached a plea bargain with the Department of Justice that would allow them to return to the UK and face the charges brought by the OFT. They will serve a combined 74 months in a US jail and pay combined fines of US$275,000.

If found guilty of the charges brought under UK law, the men will each face up to a further five years in prison, in the UK, and unlimited fines. The companies involved will also face fines of up to 10% of group annual global turnover should the European Commission's investigation find they have infringed Article 81 of the EC Treaty.

Bernardine Adkins adds, "The penalties are severe and could destroy individual and company reputations. There will be other investigations and other charges so this issue needs to move up the business agenda. Ask yourself are you sure your company's practices are on the right side of competition law?"