Antitrust Alert: UK's New Competition Law Enforcement Authority

Antitrust Alert: UK's New Competition Law Enforcement Authority

As of April 1, 2014, the UK will have a new competition law enforcer.  To date, the UK has been unusual among European Union (EU) Member States in having two distinct competition authorities, the Office of Fair Trading (OFT) and the Competition Commission (CC).  They will now be replaced by a unified authority, the Competition and Markets Authority (CMA). 

The UK Government intends the CMA to deliver what it has termed a world-class competition regime for the UK. Among its stated goals is to increase competition enforcement and an assessment of how competition works in new or rapidly changing markets, such as online markets. To this end, the CMA has a £52 million budget for 2014/15, the largest budget for a competition law authority in the EU. The changes are expected to lead to more public competition law enforcement actions in the UK. 

For clients and companies doing business in the UK, over the next few days Jones Day will issue a series of commentaries on the key changes to the UK’s competition law regime brought about by the introduction of the CMA and their implications for businesses in the UK. In the meantime, this initial alert summarises the functions, structure and relationship with sector regulators of the new authority. 


The CMA will be responsible for market investigations, cartel and antitrust cases, and merger control, and it will have wider enforcement powers and tighter procedural timetables. Jones Day will issue separate commentaries detailing the key changes in relation to each of these. By way of summary: 

Merger control. The UK is unique among EU Member States in having a voluntary merger notification regime. Contrary to expectations that the Government would replace this with a mandatory merger notification process, it has decided to keep the voluntary system. Accordingly, merging parties will continue to be able to take a view as to whether to notify a transaction to the CMA. However, the CMA will have the power to investigate completed mergers and prevent the merging parties from completing, or compel them to unwind, the transaction at any stage of a post-closing investigation, if it has grounds to believe that implementing the transaction would prejudice the outcome of an investigation. The CMA will not need to confirm that it has jurisdiction over the deal before it exercises these powers.  Existing criminal penalties for failure to comply with an order to suspend or unwind the implementation of a merger will be replaced with civil penalties of up to 5% of the merging parties’ aggregate group worldwide turnover. 

Currently, problematic mergers are referred by the OFT to the CC for an in depth review. In order to keep this peer review process, going forward the CMA Board will be responsible for Phase 1 investigations and the CMA will appoint a panel of experts responsible for Phase 2 decisions.  A notable change in relation to Phase 2 investigations is that some members of the case team are likely to have been involved in the Phase 1 investigation. This should allow for a greater level of continuity from Phase 1 than has historically been the case, although it may remove an element of the objective fresh pair of eyes approach currently adopted.

Market investigations. At present, the OFT has the power to refer markets to the CC for investigation where the OFT has reasonable grounds to believe that any feature of a market is anticompetitive. Under the new regime, the CMA will carry out these markets inquiries directly, without need for a referral, in two phases. Market participants will benefit from the introduction of statutory time limits, which will reduce the duration of the process to a maximum of 12 months for a Phase 1 market study and 18 months for an optional Phase 2 market investigation. 

Antitrust investigations. The procedures for the investigation of antitrust violations – such as cartel investigations or investigations into alleged abuses of a dominant position – will be improved. At the outset of each investigation, the CMA will be required to publish a case-specific timetable, to improve engagement with the parties – for example through greater use of state of play meetings – and to provide the parties under investigation with a copy of the draft penalty calculation, giving them an opportunity to make representations on the appropriateness of the penalty before it is imposed. Criminal penalties for failure by an individual to comply with CMA information requests will be replaced with civil penalties. The CMA will be given additional powers to require a person to answer questions similar to those available in criminal proceedings and to enjoin conduct pending conclusion of an investigation.

Cartel offence. The existing criminal cartel offence requires that an individual must have "dishonestly" agreed with one or more other persons to engage in cartel activities. Under the new regime, this dishonesty element will be removed, but new defences are allowed. To establish criminal cartel activity the CMA will need only prove intent to enter into an agreement and to operate the arrangement in question. The Government’s view is that the inclusion of the dishonesty element in the cartel offence has inhibited the prosecution of cases (only one cartel offence has been successfully tried since 2003) and anticipates that the change to the law will improve enforceability and increase deterrence, bringing levels closer to what was intended when the criminal cartel offence was introduced.


The CMA is led by a Board of senior officials, and respected figures have been appointed.  David (Lord) Currie, the Chair, was the inaugural Chair of UK communications regulator Ofcom, a position he held for seven years. Alex Chisholm (formerly Chairperson and Commissioner of Ireland’s communications regulatory agency, ComReg) has been appointed CEO. The executive directors will be Sonya Branch and Erik Wilson (both experienced OFT directors) and Andrea Coscelli, former Director of Economic Analysis at Ofcom.

Among the non-executive directors, Bill Kovacic is a former chairman of the U.S. Federal Trade Commission and a leading authority on competition regimes around the world. Philip Lowe ran the European Commission’s Directorate General for Competition for a decade. Annetje Ottow is a professor of competition law at the University of Utrecht, and was heavily engaged with the merger of the Dutch competition and telecoms authorities. Roger Witcomb was the Chairman of the CC, and Alan Giles was a Board member of the OFT. Other non-executive members include Carolyn Fairbairn (currently director of corporate development and strategy at ITV plc, and former BBC director of strategy and distribution) and Jill May (formerly managing director at UBS).

The Board will be well advised by former private practitioners Sarah Cardell as General Counsel and Dr Mike Walker as Chief Economic Adviser. Various directors will oversee the work load of the CMA, including Sheldon Mills and Nelson Jung (both formerly Directors of Mergers at the OFT) as Senior Director and Director, respectively, in charge of merger control.

A full list of the CMA board members and directors as of April 2014 is available here.

Concurrency regime

The CMA will have concurrent powers with sector regulators to enforce competition law in the regulated sectors – i.e. energy, water and sewerage, telecoms, broadcasting, post, rail, airports and air traffic services, health services in England, and financial services (so-called "concurrency regime"). There are five changes to the concurrency regime from the existing arrangements:  

  • First, the sector regulators (with the exception of Monitor in the healthcare sector in England) will be obliged to use their competition enforcement powers instead of their regulatory enforcement powers, unless their sector regulatory powers are more appropriate than general competition law powers to solve a competition issue.
  • Second, the CMA will coordinate competition policy between itself and the sector regulators through bilateral discussions and through a newly created inter-agency forum, the UK Competition Network (chaired by the CMA and composed of the UK sector regulators).
  • Third, the CMA will publish an annual report on the effectiveness of the concurrency regime and the application of competition law powers in the regulated sectors.
  • Fourth, in certain circumstances the CMA will have the power to take a case from a sector regulator and advance it itself.
  • Finally, the Secretary of State (i.e. the Government) can remove competition law powers from the sector regulators (with the exception of Monitor) if they do not use them – the so-called "use it or lose it" rule. 


The amalgamation of the OFT and the CC into a single new authority has been billed as the creation of a new organization with the potential to make better use of public resources, to enhance overall consistency and predictability for business and to be a strong voice for the benefits of competition in the UK and internationally. We expect the CMA to be more proactive than its predecessors in investigating anticompetitive activities and carrying out market investigations, with a resulting increase in public enforcement actions.  The OFT is already proactive in investigating mergers and we would expect that approach to continue. The procedural changes being introduced to competition enforcement generally, including merger control, should provide greater certainty for affected businesses as to timing and process.  We shall provide further detail and analysis of the changes to merger control, market investigations, antitrust enforcement and the cartel offence in a series of Jones Day commentaries in the run up to April.  

UK Government announcement   

Lawyer Contacts 

For more information, please contact your principal Jones Day representative or either of the lawyers listed below. 

Matt Evans

Vincent Brophy

Francesco Liberatore, an associate in the London Office, assisted in the preparation of this Alert. 

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