Directors who engage in price-rigging or bid-fixing will face up to five years in jail under new laws that come into force in the UK today.
The Enterprise Act gives the Office of Fair Trading powers to apply to disqualify directors for up to 15 years if they break competition laws. Directors will face criminal penalties if they take part in a cartel.
The Act also gives the OFT new controls over mergers and acquisitions. The OFT, rather than a government minister, will decide which mergers it will refer to the Competition Commission, and will apply a new test of a "substantial lessening of competition" in a UK market to judge which mergers it will refer to the Commission.
John Vickers, OFT Chairman, said: "The Enterprise Act coming into force is a major milestone in the development of competition and consumer law. The Act, building on previous legislation, creates a clearer and sharper framework for markets and enterprise."