THE competition watchdog chairman, Graeme Samuel, has predicted a "rush to the confessional door" by company executives guilty of price fixing following a decision by the Federal Government to double the potential jail term from five to 10 years.

The Assistant Treasurer, Chris Bowen, yesterday unveiled the revised legislation, which will introduce criminal penalties for cartel behaviour - including price fixing, market sharing and bid rigging - and bring Australia into line with the US and Britain.

The Australian Competition and Consumer Commission will also have greater power to tap the phones of companies suspected of cartel activity.

Mr Bowen said the tougher laws, to be introduced by the end of next month, put Australia "at the forefront in fighting illegal cartels".

"A jail term for cartel offences sends a clear message - price fixing is theft from consumers and won't be tolerated in this country," he said.

The move comes six years after jail terms were first proposed by the previous ACCC chairman, Allan Fels, and later adopted as a key recommendation of the 2003 Dawson Report on competition laws.

Mr Samuel said the prospect of serving jail time would act as a deterrent for price fixing and also prompt potentially guilty executives to confess to gain immunity from prosecution.

"I think there will be a rush to the confessional door of the ACCC," he said.

But the tougher laws do not apply to past activity and Mr Samuel conceded he was unlikely to secure a criminal conviction for cartel activity before his term expired in 2011.

"I think it highly unlikely that we'll see a prosecution take place during my time but I will be very satisfied to see the legislation in place," he said

Mr Fels yesterday criticised the Howard government for its "lack of enthusiasm" to act on cartels.

He said the Rudd Government's move was "timely" because the global economic slowdown had made "the temptation for price fixing especially strong".