UK: UK Parliament Debates Changes To UK Competition Regime – Need To Know

The UK Parliament has now begun to debate the changes to the UK competition regime announced on 15 March 2012. The draft legislation, set out in the Enterprise and Regulatory Reform Bill, was introduced into Parliament on 25 May and is being debated in detail by the House of Commons. The Government hopes that the Bill will become law towards the end of 2012.

The main provisions of the Bill are summarised below:

A new Competition and Markets Authority

The Bill provides for the abolition of the Office of Fair Trading (OFT) and Competition Commission (CC), and the creation of a new authority, the Competition and Markets Authority (CMA). Most of the existing functions of the OFT and the CC will be merged into the CMA.

Other regulators that currently have competition enforcement powers, such as Ofcom, the ORR, Ofgem and Ofwat, will continue to have, as now, concurrent powers to enforce competition law in their sectors, though there will be a change of emphasis – see below.

Changes to Merger Control

The UK will remain one of the few jurisdictions where notification of mergers meeting jurisdictional thresholds for review is not compulsory. However, the CMA will have a new discretionary power to require the parties to suspend all steps to conclude a deal pending the CMA's review of the merger. Non-compliance will be sanctioned by fines of up to 5 percent of worldwide sales. This now constitutes an important exception to the parties' previous freedom to close at their risk. Under the existing regime, integration steps may only be suspended in the case of already completed mergers, or where a referral is made to the CC. The CMA is required under the Bill to publish a statement about the circumstances under which the new power over uncompleted deals might be exercised.

The existing separation between a shorter first phase review of mergers and a fuller in-depth second phase review will be maintained, with the CMA board taking phase 1 decisions, and groups of independent panellists (being the existing members of the CC) taking phase 2 decisions. The power to require companies and individuals to provide information or other evidence in connection with any merger investigation will be extended to the first stage review, with fines for non-compliance.

There will now be a statutory deadline of 40 working days for the first phase review – though this may be extended where, for example, the CMA has served notice on one or more of the parties requiring the provision of further information. Phase 2 will remain at 24 weeks extendable by no more than eight weeks, and the CMA will now have a statutory deadline for implementing any remedies at the end of phase 2. There will be a continuing obligation on the CMA to act expeditiously in considering mergers.

The Bill imposes an obligation on the Secretary of State to review the workings of the merger regime every five years.

Changes to Anti-trust Regime

The Bill does not contain changes to the substance of the bans on anti-competitive agreements and abuses of market power, but does contain changes to the criminal cartel offence (see below), and to the way in which alleged infringements are investigated.

Much as the OFT does currently, the CMA will carry out an investigation as to whether an alleged infringement of the prohibition on anti-competitive agreements or abuse of dominant market position has occurred. The CMA's decision will be subject to appeal to the Competition Appeal Tribunal on the merits, and further appeal on points of law only to the Court of Appeal.

Until the CMA is established, the OFT will continue to investigate infringements and is currently consulting on whether to introduce an internal separation among staff who undertake investigations and those who take decisions: the purpose of this is to introduce more objectivity into decision making and reduce the risk of so-called 'confirmation bias'. It may be that the CMA will similarly distinguish between the investigatory phase and the decision phase.

The CMA will have a new power to demand on notice the production of information relevant to its investigation from any director, manager or employee of a business being investigated by the CMA. There are safeguards relating to the use of such information against the business concerned. The CMA will be able to impose fines for non-compliance and must publish a statement of its fining policy.

The Bill gives the Secretary of State power to adopt, after consultation, statutory deadlines for Competition Act investigations.

The CMA will have a controversial power to publish a notice, once it formally opens a Competition Act investigation, setting out the nature of the investigation, its subject matter, the sector and the parties. There is a great deal of opposition to this proposal and it remains to be seen if this will survive the parliamentary process.

A major change is proposed in relation to the criminal cartel offence created by the Enterprise Act 2002. Given the very limited success in prosecuting individuals involved in cartels, the Government has decided to remove the requirement for prosecutors to prove dishonesty, as is already the case in insider dealing offences. Intention will still be needed, and individuals who publicise agreements so as not to keep them secret will have a defence. This is a controversial amendment likely to take up much parliamentary time.

Sector Regulators and Concurrency

Concurrent competition powers of the sector regulators1 will be maintained, with a greater emphasis on using their competition powers (rather than ex-ante regulation), and a higher degree of coordination with the new CMA.

Very importantly, the Bill envisages that the CMA might have power to take over the competition elements of a case from a sectoral regulator.

Market Investigations

Powers to investigate markets, outside the scope of investigation into practices or agreements between specific companies, will be retained. This power will be extended to include investigations into practices that occur across different markets.

As in the case of mergers, there will continue to be a short phase 1 investigation and, as appropriate, an in-depth phase 2 investigation.

Time limits for phases 1 and 2 of market investigations have been shortened. At phase 1, the CMA will have to begin to consult on a decision to make a Market Investigation Reference within six months of launching a market study, and conclude all market study reports within 12 months of launch. Phase 2 investigations will now need to be finished within 18 months (although the CMA will have powers to extend the time limit by six months in exceptional circumstances), and the CMA will have to implement phase 2 remedies within six months.

The CMA will have wider information-gathering powers at phase 1 than the OFT currently enjoys.

As under the current regime, the Secretary of State will have the power to request the CMA to investigate public interest issues alongside the competition issues in market investigations: this will extend to the new cross-market investigation regime. The new provisions will permit the Secretary of State to appoint an expert on the public interest issue in question to advise the CMA.

The Bill imposes an obligation on the Secretary of State to review the workings of the markets regime every five years.


1. The sectoral regulators with concurrent competition powers are the Office of Communications; the Gas and Electricity Markets Authority; the Water Services Regulation Authority; the Office of Rail Regulation; the Northern Ireland Authority for Utility Regulation; the Civil Aviation Authority; and Monitor. Under the Financial Services Bill, the new Financial Conduct Authority will have a competition objective when using its powers (see FCA to take on competition objective).

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

In association with
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at and we will use commercially reasonable efforts to determine and correct the problem promptly.