George & Ors, R v

Under section 188(1) of the Enterprise Act 2002, an individual commits the cartel offence if that individual dishonestly agrees with another person to make or implement a prohibited arrangement. The provision does not require the prosecution also to prove dishonesty by the other participant.

Sections 188(2) and (3) identify the arrangements covered by the offence. Their references to undertakings A and B do not add a requirement of mutual dishonesty. General references in preparatory material to dishonest agreements cannot displace the clear statutory language or justify reading in that additional element.

The four appellants, employees of British Airways, were charged under section 188 of the Enterprise Act 2002 with dishonestly agreeing with employees of Virgin Atlantic Airways to make or implement price-fixing arrangements for passenger air transport services.

During a preparatory hearing, Owen J ruled for the prosecution that section 188(1) required proof of dishonesty only by the defendant under consideration. The appellants appealed with leave, contending that the offence required mutual dishonesty between a participant from each undertaking. The Court of Appeal dismissed the appeals and later gave its reasons.

1. Appeals dismissed. Section 188(1) creates an offence committed by an individual who dishonestly agrees with one or more persons to make or implement a prescribed arrangement. The adverb “dishonestly” qualifies the agreement made by that individual; it does not require proof that the other participant was dishonest.
2. The ordinary meaning of the provision was clear. A construction requiring mutual dishonesty would add words which Parliament did not use. It would also produce irrational results by allowing a dishonest participant to avoid liability because the other participant was unidentified, elusive, or lacked the subjective element of dishonesty.
3. Sections 188(2) and (3) define the forms of anti-competitive arrangement to which section 188(1) applies. Their references to arrangements involving undertakings A and B do not alter the individual nature of the dishonesty requirement in section 188(1).
4. The White Paper, the Hammond and Penrose report, and ministerial references to “dishonest agreements” did not support the appellants’ construction. They did not establish an intention to require mutual dishonesty and could not displace the clear language and purpose of the statute.
5. The law of conspiracy did not assist because section 1 of the Criminal Law Act 1977 has different language and ingredients, while conspiracy to defraud is a distinct common law offence. In a postscript, the court noted that the parties’ proposed route for preserving a contingent further appeal without delaying the trial could be a pragmatic procedural approach.

• Court of Appeal (Criminal Division): The appeals were dismissed in [2010] EWCA Crim 1148.
• Crown Court: During a preparatory hearing, Owen J ruled in favour of the prosecution that mutual dishonesty was not an ingredient of the section 188 offence.