I beg to move amendment No. 115, in page 139, line 13, leave out from 'infringes' to end of line 23 and insert

'an offence under section 179 of the Enterprise Act 2002'.

The law currently provides for unfit persons to be disqualified from being directors or otherwise involved in the management of limited companies for a certain period without the leave of the court. The clause would extend those provisions to directors of companies who commit a breach of competition law. We debated at some length whether cartel offences should be classed as criminal offences. It was the clear view of Conservative Members that they should not be. However, following the withdrawal of certain amendments it would now be the case that, as with any other criminal offence, the court would have the opportunity to attach a disqualification order at the time of sentencing. That power is not being questioned, although we believe that it would make sense for it to be spelled out in the Bill. That would be part of the effect of amendment No. 115, which would insert the new section 179 cartel offence as a breach of competition law.

However, the Bill goes further by extending the definition of breaches of competition law to include chapter 1 and 2 prohibitions and breaches of articles 81 and 82 of the EC treaty. That represents a radical change. None of the prohibitions involves criminal sanctions against directors. They are civil issues, and a company could be fined if it were found to be in breach of them. That might look straightforward, but I do not think that it is—mainly because the concept behind directors disqualification orders is that they are issued on the back of criminal or insolvency sanctions. In other words, if the director were considered unfit, that would be apparent from the underlying case. That is not the situation here; in most cases the underlying action would relate to the conduct of the company as a

whole, not to the rights and wrongs of a particular director's actions or lack of them.

The way in which disqualification orders work is not through an independent trial of the rights and wrongs of the particular disqualification, but by the orders being attached to other sanctions. As a result, there is a significant chance either that a director could be disqualified for reasons that the law would not otherwise attribute to him or her, or that the period of disqualification arising out of the process could be grossly disproportionate to the individual's offence.

Furthermore, the new clause gives no sense of proportionality concerning the extent to which a company might have breached, for example, article 1. These are not black and white issues, and we are not talking about criminal offences. Breaches could be on a large or a small scale. How would that be reflected in the period of disqualification? The amendment reflects those problems, and states that disqualification should relate only to criminal circumstances.