OFT + CC = CMA
On 1 April 2014, the UK's competition enforcers the Office of Fair Trading (OFT) and Competition Commission (CC) will be abolished. Their functions will be transferred to the new Competition and Markets Authority (CMA) which was established under the Enterprise and Regulatory Reform Act 2013 (ERRA13). The CMA will be the UK’s economy-wide competition authority responsible for ensuring that competition and markets work well for consumers.
Recent announcements about the CMA suggest that there will be a substantial increase in the frequency and ferocity of enforcement activity in the UK once the CMA 'goes live'. For example:
- In the Government's recent mini-Spending Review, it was announced that the proposed budget for the CMA will be increased by £16 million in 2015-2016. This is to be focused on enforcement, particularly in relation to cartels and enhanced co-operation with sector regulators.
- The CMA Board will include William E Kovacic. He was General Counsel and then Chairman of the Federal Trade Commission in the US and was instrumental in, for example, the FTC's attack on pharma "pay-for-delay" settlement agreements.
The CMA, in any event, benefits from enhanced powers when compared to the current enforcers. In antitrust investigations it will have the power to compel executives to submit to interview; when it publishes notice of investigation it may name the parties involved; and it will have extended powers to impose fines for failure to comply with investigations. It will also have the power to impose fines of up to 30% of turnover in the market affected by any infringement.
The Department for Business, Innovation and Skills is currently consulting on the first set of guidance documents for the CMA.