The Competition and Markets Authority (“CMA”), the new central competition regulator, will continue the Office of Fair Trading’s (“OFT”) policy of cash rewards for cartel whistleblowers. The little known programme has been in place since 2008 and aims to reward individuals who come forward with inside information on cartel activity such as price fixing or allocating customers between competitors.

Rewards of £100,000 are available to individuals but the full £100,000 will not be awarded in every situation. The CMA, like the OFT, will have discretion to decide the exact figure and will base the calculation on the value of the information with regard to prosecution, the amount of harm the activity is causing the economy and the risk and effort the whistleblower has taken in providing the information.

Whilst whistleblowers can initially come forward anonymously, in order to verify the information and if they should want a reward, they will have to identify themselves to the CMA. The CMA can than protect them if necessary from civil and criminal prosecution by applying for an order under the Regulation of Investigatory Powers Act 2000. Whistleblowers are also protected under other laws from losing their job as a result of whistleblowing.

Crucially, and perhaps most controversially, those directly responsible for cartel activity will not be able to come forward for cash rewards. They can still however obtain immunity from prosecution (at the discretion of the CMA) both for themselves and their company if they come forward. Whilst no doubt this decision is based on the policy of not wanting to reward people who have been actively breaking the law, it could be argued that the people best placed to whistleblow and give the CMA the best information are those carrying out the behaviour.

Some would argue that the greater good of incentivising more whistleblowing of cartel activity is a more pressing public concern than not rewarding individuals who participated in it. In fact the CMA could have taken the opportunity to go a lot further than the OFT and implement a US style system. Under the US 2010 Dodd-Frank Act, individuals who come forward and give high quality information on fraud that results in sanctions over $1 million can be granted up to 30% of the fine imposed.

To put that in context, in 2011 the than OFT fined members of a Dairy cartel nearly £50 million for co-ordinating increases in prices. If an individual had given that information under a US style law and was directly attributable for the fines later issued, they could have personally got up to £15,000,000. Although it seems unjust to reward someone with a fortune who participated in wrongdoing, one wonders how many cartels would survive if individuals were promised a greater slice of the pie for coming forward.