Enterprise Bill brings UK competition law up to date

On 26 March, the Government introduced the Enterprise Bill in the House of Commons. The Government is aiming to make the UK the best place in the world to do business and believes that the Bill will go some way towards achieving this objective. The Bill aims to boost productivity by encouraging enterprise and competition. In addressing competition matters, the Government has tried to make the link between consumer interests and competition policy in the same way as it is understood in the USA. The Bill therefore considerably strengthens the powers of regulators both as regards their decision-making and sanctioning functions.

The Bill, if enacted in its present form, will radically overhaul the UK’s competition law regime by introducing the following reforms:

• A new regime for mergers, with decisions taken in most cases by expert, independent, competition authorities against a competition-based test rather than the current public interest test
• A new regime for investigating markets, which will replace the existing monopoly regime established by the Fair Trading Act 1973. Again, most decisions will be taken by independent competition authorities against a competition-based test rather than the current public interest test
• Criminal sanctions for individuals who engage in hard-core cartels, with a maximum penalty of five years in prison for those who participate in them
• A new power for courts to disqualify directors involved in breaches of competition law
• A new provision allowing persons harmed by a breach of competition law to bring claims for damages before a specialist competition body (the Competition Appeal Tribunal (CAT))
• An amendment to the 1998 Act providing third parties with a direct right of appeal to the CAT against decisions of the OFT or Directors General of the sector regulators
• Public authorities holding information obtained in connection with competition investigations carried out under a number of statutes will be allowed to disclose this information in certain circumstances.
• Consumer groups will be able to make “super-complaints to the OFT which will have fixed deadlines in which to respond.

As a result of the lengthy consultation period, the Bill contains few surprises. However, the changes it will introduce are far-reaching for UK business.

If you have any questions on the Enterprise Bill and what it means for your business, please do not hesitate to contact Susan Hankey, Dick Taylor or David Marks by emailing [email protected] or by calling +44(0)20 7367 3000.