Previous Next

Contents page 1-9 10-19 20-29 30-39 40-49 50-59 60-69 70-79 80-89 90-99 100-109 110-119 120-129 130-139 Last page

Enterprise and Regulatory Reform BillPage 30

(6) After subsection (9) insert—

(9A) In subsection (1), “enforcement functions” means—

(a) in relation to the CMA—

(i) functions conferred by virtue of section 164(2)(b) on the
5CMA by enforcement orders;

(ii) functions of the CMA in relation to the variation,
supersession or release of enforcement undertakings or
the variation of revocation of enforcement orders;

(iii) functions of the CMA under or by virtue of section 160
10or 162 in relation to enforcement undertakings or
enforcement orders;

(b) in relation to the Secretary of State—

(i) functions conferred by virtue of section 164(2)(b) on the
Secretary of State by enforcement orders;

(ii) 15functions of the Secretary of State in relation to the
variation, supersession or release of enforcement
undertakings or the variation or revocation of
enforcement orders;

(iii) functions of the Secretary of State under or by virtue of
20section 160 in relation to enforcement undertakings or
enforcement orders.

(7) For the heading substitute “Attendance of witnesses and production of
documents etc.”.

(8) Schedule 11 (which makes provision about the enforcement of the powers
25under section 174 of the 2002 Act, as amended by this section, and which makes
consequential amendments of that Act) has effect.

Interim measures

31 Interim measures: pre-emptive action: markets

(1) Part 4 of the 2002 Act (market investigations) is amended as follows.

(2) 30In section 157 (interim undertakings: Part 4), after subsection (2) insert—

(2A) Subsection (2B) applies where—

(a) subsection (1)(a) to (c) applies; and

(b) the relevant authority has reasonable grounds for suspecting
that pre-emptive action has or may have been taken.

(2B) 35The relevant authority may, for the purpose of restoring the position to
what it would have been had the pre-emptive action not been taken or
otherwise for the purpose of mitigating its effects, accept, from such
persons as the relevant authority considers appropriate, undertakings
to take such action as the relevant authority considers appropriate.

(3) 40After subsection (2B) of that section insert—

(2C) A person may, with the consent of the relevant authority, take action of
a particular description where the action would otherwise constitute a
contravention of an undertaking accepted under this section.

Enterprise and Regulatory Reform BillPage 31

(4) In section 158 (interim orders: Part 4), after subsection (2) insert—

(2A) Subsection (2B) applies where—

(a) subsection (1)(a) to (c) applies; and

(b) the relevant authority has reasonable grounds for suspecting
5that pre-emptive action has or may have been taken.

(2B) The relevant authority may by order, for the purpose of restoring the
position to what it would have been had the pre-emptive action not
been taken or otherwise for the purpose of mitigating its effects—

(a) do anything mentioned in subsection (2)(b) to (d);

(b) 10impose such other obligations, prohibitions or restrictions as it
considers appropriate for that purpose.

(5) After subsection (2B) of that section insert—

(2C) A person may, with the consent of the relevant authority, take action of
a particular description where the action would otherwise constitute a
15contravention of an order under this section.

Time-limits and procedure

32 Market studies and market investigations: consultation and time-limits

Schedule 12 (which makes provision about consultation in relation to decisions
whether to make a market investigation reference and about time-limits in
20relation to the conduct of market studies and the markets investigation
reference regime under Part 4 of the 2002 Act) has effect.

CHAPTER 3 Anti-trust

Investigation powers

33 Investigations: power to ask questions

(1) 25Part 1 of the Competition Act 1998 (“the 1998 Act”) (competition) is amended
as follows.

(2) After section 26 (powers when conducting investigations) insert—

26A Investigations: power to ask questions

(1) For the purposes of an investigation, the CMA may give notice to an
30individual who has a connection with a relevant undertaking requiring
the individual to answer questions with respect to any matter relevant
to the investigation—

(a) at a place specified in the notice, and

(b) either at a time so specified or on receipt of the notice.

(2) 35The CMA must give a copy of the notice under subsection (1) to each
relevant undertaking with which the individual has a current
connection at the time the notice is given to the individual.

Enterprise and Regulatory Reform BillPage 32

(3) The CMA must take such steps as are reasonable in all the
circumstances to comply with the requirement under subsection (2)
before the time at which the individual is required to answer questions.

(4) Where the CMA does not comply with the requirement under
5subsection (2) before the time mentioned in subsection (3), it must
comply with that requirement as soon as practicable after that time.

(5) A notice under subsection (1) must be in writing and must indicate—

(a) the subject matter and purpose of the investigation, and

(b) the nature of the offence created by section 44.

(6) 10For the purposes of this section—

(a) an individual has a connection with an undertaking if he or she
is or was—

(i) concerned in the management or control of the
undertaking, or

(ii) 15employed by, or otherwise working for, the
undertaking, and

(b) an individual has a current connection with an undertaking if,
at the time in question, he or she is so concerned, is so employed
or is so otherwise working.

(7) 20In this section, a “relevant undertaking” means an undertaking whose
activities are being investigated as part of the investigation in
question.

(3) For the heading of section 26 substitute “Investigations: powers to require
documents and information”.

(4) 25Section 30A (use of statements in prosecution) is amended as follows.

(5) The existing text becomes subsection (1).

(6) In subsection (1), for “26 to 28A” substitute “26 and 27 to 28A”.

(7) After that subsection insert—

(2) A statement by an individual in response to a requirement imposed by
30virtue of section 26A (a “section 26A statement”) may only be used in
evidence against the individual—

(a) on a prosecution for an offence under section 44, or

(b) on a prosecution for some other offence in a case falling within
subsection (3).

(3) 35A prosecution falls within this subsection if, in the proceedings—

(a) in giving evidence, the individual makes a statement
inconsistent with the section 26A statement, and

(b) evidence relating to the section 26A statement is adduced, or a
question relating to it is asked, by or on behalf of the individual.

(4) 40A section 26A statement may not be used in evidence against an
undertaking with which the individual who gave the statement has a
connection on a prosecution for an offence unless the prosecution is for
an offence under section 44.

(5) For the purposes of subsection (4), an individual has a connection with
45an undertaking if he or she is or was—

Enterprise and Regulatory Reform BillPage 33

(a) concerned in the management or control of the undertaking, or

(b) employed by, or otherwise working for, the undertaking.

34 Civil enforcement of investigation powers

(1) Part 1 of the 1998 Act (competition) is amended as follows.

(2) 5After section 40 insert—

Civil sanctions
40A Penalties: failure to comply with requirements

(1) Where the CMA considers that a person has, without reasonable
excuse, failed to comply with a requirement imposed on the person
10under section 26, 26A, 27, 28 or 28A, it may impose a penalty of such
amount as it considers appropriate.

(2) The amount may be—

(a) a fixed amount,

(b) an amount calculated by reference to a daily rate, or

(c) 15a combination of a fixed amount and an amount calculated by
reference to a daily rate.

(3) A penalty imposed under subsection (1) must not—

(a) in the case of a fixed amount, exceed such amount as the
Secretary of State may by order specify;

(b) 20in the case of an amount calculated by reference to a daily rate,
exceed such amount per day as the Secretary of State may so
specify;

(c) in the case of a fixed amount and an amount calculated by
reference to a daily rate, exceed such fixed amount and such
25amount per day as the Secretary of State may so specify.

(4) The fixed amount specified for the purposes of subsection (3)(a) or (c)
may not exceed £30,000.

(5) The amount per day specified for the purposes of subsection (3)(b)
or (c) may not exceed £15,000.

(6) 30In imposing a penalty by reference to a daily rate—

(a) no account is to be taken of any days before the service of the
notice under section 112 of the Enterprise Act 2002 (as applied
by subsection (9)) on the person concerned, and

(b) unless the CMA determines an earlier date (whether before or
35after the penalty is imposed), the amount payable ceases to
accumulate at the beginning of the earliest of the days
mentioned in subsection (7).

(7) The days are—

(a) the day on which the requirement concerned is satisfied;

(b) 40the day on which the CMA makes a decision (within the
meaning given by section 31(2)) or terminates the investigation
in question without making such a decision;

Enterprise and Regulatory Reform BillPage 34

(c) if the Secretary of State has made an order under section
31F(1)(b) imposing a time-limit on the making of such a
decision, the latest day on which such a decision may be made
as a result of the investigation in question.

(8) 5Before making an order under subsection (3), the Secretary of State
must consult the CMA and such other persons as the Secretary of State
considers appropriate.

(9) Sections 112 to 115 of the Enterprise Act 2002 (supplementary
provisions about penalties) apply in relation to a penalty imposed
10under subsection (1) as they apply in relation to a penalty imposed
under section 110(1) of that Act.

40B Statement of policy on penalties

(1) The CMA must prepare and publish a statement of policy in relation to
the use of its powers under section 40A.

(2) 15The CMA must, in particular, include a statement about the
considerations relevant to the determination of the nature and amount
of any penalty imposed under section 40A.

(3) The CMA may revise its statement of policy and, where it does so, it
must publish the revised statement.

(4) 20The CMA must consult such persons as it considers appropriate when
preparing or revising its statement of policy.

(5) If the proposed statement of policy or revision relates to a matter in
respect of which a regulator exercises concurrent jurisdiction, those
consulted must include that regulator.

(6) 25In deciding whether and, if so, how to proceed under section 40A, the
CMA must have regard to the statement of policy which was most
recently published under this section at the time when the failure
concerned occurred.

(3) Section 38 (guidance about appropriate level of penalties under section 36) is
30amended as follows.

(4) In subsection (1), after “under this Part” insert “in respect of an infringement of
the Chapter 1 prohibition, the Chapter 2 prohibition, the prohibition in Article
81(1) or the prohibition in Article 82”.

(5) In subsection (1A), for “a penalty under this Part” substitute “such a penalty”.

(6) 35In subsection (8), after “under this Part” insert “in respect of an infringement of
a kind mentioned in subsection (1)”.

(7) Section 42 (offences of failure to comply with requirements imposed in
investigations and obstruction) is amended as follows.

(8) Omit subsections (1) to (4).

(9) 40In subsection (6), omit “(1) or”.

Enterprise and Regulatory Reform BillPage 35

35 Extension of powers to issue warrants to CAT

Schedule 13 (which amends the 1998 Act to extend the powers under that Act
to issue warrants to the Competition Appeal Tribunal) has effect.

36 Part 1 of the 1998 Act: procedural matters

(1) 5Part 1 of the 1998 Act (competition) is amended as follows.

(2) After section 25 (power to investigate) insert—

25A Power of CMA to publish notice of investigation

(1) Where the CMA decides to conduct an investigation it may publish a
notice which may, in particular—

(a) 10state its decision to do so;

(b) indicate which of subsections (2) to (7) of section 25 the
investigation falls under;

(c) summarise the matter being investigated;

(d) identify any undertaking whose activities are being
15investigated as part of the investigation;

(e) identify the market which is or was affected by the matter being
investigated.

(2) Section 57 does not apply to a notice under subsection (1) to the extent
that it includes information other than information mentioned in that
20subsection.

(3) Subsection (4) applies if—

(a) the CMA has published a notice under subsection (1) which
identifies an undertaking whose activities are being
investigated, and

(b) 25the CMA subsequently decides (without making a decision
within the meaning given by section 31(2)) to terminate the
investigation of the activities of the undertaking so identified.

(4) The CMA must publish a notice stating that the activities of the
undertaking in question are no longer being investigated.

(3) 30Schedule 9 (examples of provision that may be made in rules) is amended as
follows.

(4) After paragraph 1 insert—

Delegation of functions

1A (1) Rules may provide for the exercise of a function of the CMA under
35this Part on its behalf—

(a) by one or more members of the CMA Board (see Part 2 of
Schedule 4 to the Enterprise and Regulatory Reform Act
2012);

(b) by one or more members of the CMA panel (see Part 3 of that
40Schedule to that Act);

(c) by one or more members of staff of the CMA;

(d) jointly by one or more of the persons mentioned in paragraph
(a), (b) or (c).

Enterprise and Regulatory Reform BillPage 36

(2) Sub-paragraph (1) does not apply in relation to any function
prescribed in regulations made under section 7(1) of the Civil
Aviation Act 1982 (power for Secretary of State to prescribe certain
functions of the Civil Aviation Authority which must not be
5performed on its behalf by any other person).

(5) After paragraph 13 insert—

Oral hearings: procedure

13A (1) Rules may make provision as to the procedure to be followed by the
CMA in holding oral hearings as part of an investigation.

(2) 10Rules may, in particular, make provision as to the appointment of a
person mentioned in sub-paragraph (3) who has not been involved
in the investigation in question to—

(a) chair an oral hearing, and

(b) prepare a report following the hearing and give it to the
15person who is to exercise on behalf of the CMA its function of
making a decision (within the meaning given by section
31(2)) as a result of the investigation.

(3) The persons are—

(a) a member of the CMA Board;

(b) 20a member of the CMA panel;

(c) a member of staff of the CMA.

(4) The report must—

(a) contain an assessment of the fairness of the procedure
followed in holding the oral hearing, and

(b) 25identify any other concerns about the fairness of the
procedure followed in the investigation which have been
brought to the attention of the person preparing the report.

(6) After paragraph 13A insert—

Procedural complaints

13B (1) 30Rules may make provision as to arrangements to be made by the
CMA for dealing with complaints about the conduct by the CMA of
an investigation.

(2) Rules may, in particular, make provision as to—

(a) the appointment of a person mentioned in sub-paragraph (3)
35who has not been involved in the investigation in question to
consider any such complaint;

(b) the time-table for the consideration of any such complaint.

(3) The persons are—

(a) a member of the CMA Board;

(b) 40a member of the CMA panel;

(c) a member of staff of the CMA.

Enterprise and Regulatory Reform BillPage 37

(7) After paragraph 13B insert—

Settling cases

13C Rules may make provision as to the procedure to be followed in a
case where, during an investigation, one or more persons notify the
5CMA that they accept that there has been an infringement of a kind
to which the investigation relates.

Interim measures and other sanctions

37 Threshold for interim measures

In section 35 of the 1998 Act (interim measures), in subsection (2)(a), for
10“serious, irreparable damage” substitute “significant damage”.

38 Penalties: guidance etc.

(1) Part 1 of the 1998 Act (competition) is amended as follows.

(2) In section 36 (penalties), after subsection (7) insert—

(7A) In fixing a penalty under this section the CMA must have regard to—

(a) 15the seriousness of the infringement concerned, and

(b) the desirability of deterring both the undertaking on whom the
penalty is imposed and others from—

(i) entering into agreements which infringe the Chapter 1
prohibition or the prohibition in Article 81(1), or

(ii) 20engaging in conduct which infringes the Chapter 2
prohibition or the prohibition in Article 82.

(3) In section 38 (guidance on level of penalties), in subsection (8), before “must
have regard” insert “and the Tribunal”.

Miscellaneous

39 25Power for Secretary of State to impose time-limits on investigations etc.

After section 31E of the 1998 Act insert—

31F Power for Secretary of State to impose time-limits on investigations
etc.

(1) The Secretary of State may by order impose time-limits in relation to—

(a) 30the conduct by the CMA of investigations or investigations of a
description specified in the order;

(b) the making by the CMA of decisions (within the meaning given
by section 31(2)) as a result of investigations or investigations of
such a description.

(2) 35Before making an order under subsection (1), the Secretary of State
must consult the CMA and such other persons as the Secretary of State
considers appropriate.

Enterprise and Regulatory Reform BillPage 38

40 Review of operation of Part 1 of 1998 Act

(1) The Secretary of State must—

(a) review the operation of Part 1 of the 1998 Act, and

(b) prepare and publish a report on the outcome of the review.

(2) 5The report must be published before the end of the period of 5 years beginning
with the day on which Part 1 of Schedule 5 (which transfers the functions of the
Office of Fair Trading under Part 1 of the 1998 Act to the Competition and
Markets Authority) comes into force.

(3) The Secretary of State must lay the report before Parliament.

CHAPTER 4 10Cartels

41 Cartel offence

(1) Section 188 of the 2002 Act (cartel offence) is amended as follows.

(2) In subsection (1), omit “dishonestly”.

(3) Omit subsection (6).

(4) 15After subsection (7) insert—

(8) This section is subject to section 188A.

(5) After that section insert—

188A Circumstances in which cartel offence not committed

(1) An individual does not commit an offence under section 188(1) if,
20under the arrangements—

(a) in a case where the arrangements would (operating as the
parties intend) affect the supply in the United Kingdom of a
product or service, customers would be given relevant
information about the arrangements before they enter into
25agreements for the supply to them of the product or service so
affected,

(b) in the case of bid-rigging arrangements, the person requesting
bids would be given relevant information about them at or
before the time when a bid is made, or

(c) 30in any case, relevant information about the arrangements
would be published, before the arrangements are implemented,
in the manner specified at the time of the making of the
agreement in an order made by the Secretary of State.

(2) In subsection (1), “relevant information” means—

(a) 35the names of the undertakings to which the arrangements
relate,

(b) a description of the nature of the arrangements which is
sufficient to show why they are or might be arrangements of the
kind to which section 188(1) applies,

(c) 40the products or services to which they relate, and

Enterprise and Regulatory Reform BillPage 39

(d) such other information as may be specified in an order made by
the Secretary of State.

(3) An individual does not commit an offence under section 188(1) if the
agreement is made in order to comply with a legal requirement.

(4) 5In subsection (3), “legal requirement” has the same meaning as in
paragraph 5 of Schedule 3 to the Competition Act 1998.

(5) A power to make an order under this section—

(a) is exercisable by statutory instrument,

(b) may be exercised so as to make different provision for different
10cases or different purposes, and

(c) includes power to make such incidental, supplementary,
consequential, transitory, transitional or saving provision as the
Secretary of State considers appropriate.

(6) A statutory instrument containing an order under this section is subject
15to annulment in pursuance of a resolution of either House of
Parliament.

(6) After section 188A (as inserted by subsection (5) above) insert—

188B Defences to commission of cartel offence

(1) In a case where the arrangements would (operating as the parties
20intend) affect the supply in the United Kingdom of a product or service,
it is a defence for an individual charged with an offence under section
188(1) to show that, at the time of the making of the agreement, he or
she did not intend that the nature of the arrangements would be
concealed from customers at all times before they enter into agreements
25for the supply to them of the product or service.

(2) It is a defence for an individual charged with an offence under section
188(1) to show that, at the time of the making of the agreement, he or
she did not intend that the nature of the arrangements would be
concealed from the CMA.

(3) 30It is a defence for an individual charged with an offence under section
188(1) to show that, before the making of the agreement, he or she took
reasonable steps to ensure that the nature of the arrangements would
be disclosed to professional legal advisers for the purposes of obtaining
advice about them before their making or (as the case may be) their
35implementation.

(7) After section 190 of the 2002 Act insert—

190A Cartel offence: prosecution guidance

(1) The CMA must prepare and publish guidance on the principles to be
applied in determining, in any case, whether proceedings for an offence
40under section 188(1) should be instituted.

(2) The CMA may at any time issue revised or new guidance.

(3) Guidance published by the CMA under this section is to be published
in such manner as it considers appropriate.

(4) In preparing guidance under this section the CMA must consult—

(a) 45the Director of the Serious Fraud Office;

(b) the Lord Advocate; and

(c) such other persons as it considers appropriate.

Previous Next

Contents page 1-9 10-19 20-29 30-39 40-49 50-59 60-69 70-79 80-89 90-99 100-109 110-119 120-129 130-139 Last page