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Read the background note

  29 November 2022  Paris

Director disqualification describes a sanction where an individual is not allowed to act as a director of a company for a period following a violation of competition law. Bidder exclusion is the banning of the company from a bidding process or future public procurement tenders, typically in a specific market and for a specific amount of time.

In the context of the importance of fighting cartels and bid rigging and of the debate around whether antitrust fines may be too low relative to the gains from the infringement, these forms of debarment may be very effective. Their application, however, raises a few practical challenges relating to the objectives pursued, the scope of application (e.g. which individuals or companies should be subject to it, for how long and in which markets), the standard of proof to be met, and the negative consequences they may bring about.

In November 2022, the OECD held a discussion to explore the objective and scope of application of debarment sanctions in different jurisdictions; the practical issues associated with their application and their effectiveness.

KEY TAKEAWAYS

Participating delegations discussed the two debarment measures of director disqualification and bidder exclusion, their objectives, application and challenges. While the measures vary significantly in their design and application from jurisdiction to jurisdiction, there was consensus that

1. they not only exercise strong deterrent power but also enable preserving the integrity of the tender or protecting the community from corporate misconduct;
2. they raise challenges as regards, among others, their effects on the company and market; and
3. competition authorities have an important role in ensuring that the use of debarment measures does not result in competition distortions.

All related documentation is available on this page. 

See the full list of best practice roundtables on competition.

Peter Whelan Bio  
Professor of Law, University of Leeds

Amanda Athayde Bio  
Professor of Law, University of Brasilia

Emmanuelle Auriol Bio  
Professor of Economics, Toulouse 1 Capitole University

Background note

Note by Amanda Athayde and Renan Cruvinel

Contributions to come

Amanda Athayde

Emmanuelle Auriol

Peter Whelan

OECD Secretariat

Competition compliance programmes (2021)

Criminalisation of cartels and bid rigging conspiracies (2020)

Competition and sanctions in antitrust cases  (2016)

Procedural Fairness: Issues in Civil and Administrative Enforcement Proceedings (2010)

Public Procurement and the Role of Competition Authorities in Promoting Competition (2007)

Cartels: Sanctions Against Individuals (2003)

Competition Policy and Procurement Markets (1998)

OECD best practice roundtables on competition

More OECD work on competition