A Pathology of Business Cartels: Original Sin or the Child of Regulation?

Over the last 10 to 15 years there has been a significant movement towards criminalisation of involvement in business cartels in a number of jurisdictions around the world, outside of the US and Canada where such conduct has been a criminal offence since the end of the nineteenth century. In particular there is now an emphasis on individual or personal as distinct from corporate liability and on the use of severe sanctions such as imprisonment. For European jurisdictions, this represents a significant shift in enforcement strategy and the perception of activities such as price fixing, market sharing and bid rigging. Observation of these legal developments inevitably gives rise to the question: what is so bad about cartel conduct as to merit censure and sanctioning through the processes of criminal law? However, a clear consensus on the specific nature of cartel delinquency remains elusive. The American approach has been to identify an element of conspiracy in the criminality of what are now commonly referred to as hard core cartels. Elsewhere, there are ill-thought out analogies put forward with theft, fraud and dishonesty. The argument in this paper seeks a justification for criminalisation in the upward spiral of enforcement activity and consequent cartel defensiveness, turning cartelists into ‘cognisant, contumacious and covert’ actors who are evolving an increasingly determined outlaw identity in the face of an increasingly assertive global enforcement enterprise.