FIRMS in Hampshire could be unwittingly breaking competition laws and risking severe penalties, warns David Ashplant of South-ampton law firm Lester Aldridge.

The Office of Fair Trading (OFT) fined a number of roofing contractors in the West Midlands more than £330,000 after finding they had engaged in collusive tendering, agreeing not to bid or to outbid each other on certain contracts.

The decision opened the door for customers who suffered as a result, in this case public sector companies, to sue contractors on the basis they paid more than they would have if there had been no collusion.

David, pictured, head of the corporate team at LA, said the OFT will now be looking into the building trade country-wide.

He added: "There will be more cases and I think it's inevitable there will be some in this region. It will apply to the building trade but also to any companies which have got together to fix prices and agreed not to outbid each other.

"Many people won't realise they are breaking the law by doing this but that will not prevent them being fined."

In the recent case the collusive tendering had taken place before the cartel-busting provisions of

the 2002 Enterprise Act came into force.

If it happened now the OFT could also take the companies and directors to court for a criminal offence.

Penalties for this could include fines and possibly even jail sentences or a period of disqualific-ation from being involved in the management of a company

However, a different legal decision regarding competition law in the UK may bring comfort to some businesses in the licensed trade.

An English court recently awarded damages for the first time for breach of European competition law. A tenant of a tied pub had seen his business fail and was sued by the brewer for unpaid debts.

He counter-sued, claiming the fact he had to pay more for his beer than independent tenants was a breach of competition law.

The Court of Appeal agreed with him and he was awarded more than £130,000 in damages.