By Max Clarke
A single competition authority to boost growth and streamline processes for business will be set up under proposals to improve the UK’s competition regime, Business Minister Edward Davey announced today.
The news will be welcomed by business groups, including the Confederation of British Industry, who have long been advocating the deregulation of the Competition Commission in order to stimulate the economy.
‘A Competition Regime for Growth: a consultation on options for reform’ sets out proposals to create a single Competition and Markets Authority by merging the competition functions of the Office of Fair Trading (OFT) with the Competition Commission (CC). The UK already has a globally regarded competition system but Ministers are determined to make sure that it supports growth while simplifying the existing system for business.
The proposals to strengthen and streamline the competition regime will boost the existing arrangement in a number of ways. This includes reducing the duplication of costs for business, and increasing industry confidence in the system.
The Government wants to stimulate growth by allowing the market to be dynamic and competitive. Ministers also want to empower small and medium businesses by giving them greater support in the system.
"Aimed at streamlining and speeding up decision making", commented Duncan Liddell, partner at Ashurst LLP, "the consultation is more wide ranging and open than expected.
Liddell continued: "Beyond the anticipated merger of the OFT and Competition Commission into a new Competition and Markets Authority, there are a number of more revolutionary proposals including mandatory notification of mergers, significant lowering of thresholds for bringing criminal proceedings and very considerable increases in fees for competition investigations. Businesses will welcome quicker decision making but will be more concerned about the increasing costs of investigations and the greater risk of criminal sanctions."
• Creating a single, powerful advocate for competition: The Competition and Markets Authority would ensure dynamic and flexible use of tools to ensure strong and fair competition.
• Increasing business confidence: through faster decision making, ending duplication, and more predictability of competition processes and decisions.
• Reducing barriers to entry: by making it easier for the competition authority to tackle anti-competitive mergers; and reform anti-trust provisions to increase deterrence of anti-competitive and abusive behaviour.
• Delivering faster results for consumers: we want shorter end-to-end studies and investigations into markets where lack of competition is giving consumers a bad deal.
• Reducing the SME burden: we want to introduce an exemption for small mergers from the merger control regime.
• Giving small business a voice: an extended supercomplaints process to spotlight market features that harm small companies.
Said Minister Davey:
“The UK Competition Regime is regarded as one of the best in the world. But it can and should be even better. Competition is the cornerstone of growth, innovation and consumer choice. That means we also need to have a strong regime to promote effective competition in markets.
“This is an excellent opportunity to strengthen and streamline the competition regime to deliver better outcomes for consumers and increase business confidence and certainty. At the same time we are taking advantage of this chance of reforming it to assist small and medium enterprises. I hope that everyone interested in this consultation will take the time to respond to our proposals.”