Competition Bill [H.L.]

Competition Bill [H.L.] - continued	House of Commons
PART I, COMPETITION - continued
Enforcement - continued

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Interim measures.	36. - (1) This section applies if the Director-
	(a) has a reasonable suspicion that the Chapter I prohibition has been infringed, or
	(b) has a reasonable suspicion that the Chapter II prohibition has been infringed,
	but has not completed his investigation into the matter.
	(2) If the Director considers that it is necessary for him to act under this section as a matter of urgency for the purpose-
	(a) of preventing serious, irreparable damage to a particular person or category of person, or
	(b) of protecting the public interest,
	he may give such directions as he considers appropriate for that purpose.
	(3) Before giving a direction under this section, the Director must-
	(a) give written notice to the person (or persons) to whom he proposes to give the direction; and
	(b) give that person (or each of them) an opportunity to make representations.
	(4) A notice under subsection (3) must indicate the nature of the direction which the Director is proposing to give and his reasons for wishing to give it.
	(5) A direction given under this section has effect while subsection (1) applies, but may be replaced if the circumstances permit by a direction under section 33 or (as appropriate) section 34.
	(6) In the case of a suspected infringement of the Chapter I prohibition, sections 33(3) and 35 also apply to directions given under this section.
	(7) In the case of a suspected infringement of the Chapter II prohibition, sections 34(3) and 35 also apply to directions given under this section.
Penalty for infringing Chapter I or Chapter II prohibition.	37. - (1) On making a decision that an agreement infringes the Chapter I prohibition, the Director may require an undertaking which is a party to the agreement to pay him a penalty in respect of the infringement.
	(2) On making a decision that conduct infringes the Chapter II prohibition, the Director may require the undertaking concerned to pay him a penalty in respect of the infringement.
	(3) Subsection (1) is subject to section 40 and does not apply if the Director is satisfied that the undertaking acted on the reasonable assumption that that section gave it immunity in respect of the agreement.
	(4) Subsection (2) is subject to section 41 and does not apply if the Director is satisfied that the undertaking acted on the reasonable assumption that that section gave it immunity in respect of the conduct.
	(5) Notice of a penalty under this section must-
	(a) be in writing; and
	(b) specify the date before which the penalty is required to be paid.
	(6) The date specified must not be earlier than the end of the period within which an appeal against the notice may be brought under section 47.
	(7) No penalty fixed by the Director under this section may exceed 10% of the turnover of the undertaking (determined in accordance with such provisions as may be specified in an order made by the Secretary of State).
	(8) Any sums received by the Director under this section are to be paid into the Consolidated Fund.
Recovery of penalties.	38. - (1) If the specified date in a penalty notice has passed and-
	(a) the period during which an appeal against the imposition, or amount, of the penalty may be made has expired without an appeal having been made, or
	(b) such an appeal has been made and determined,
	the Director may recover from the undertaking, as a civil debt due to him, any amount payable under the penalty notice which remains outstanding.
	(2) In this section-
	"penalty notice" means a notice given under section 37; and
	"specified date" means the date specified in the penalty notice.
The appropriate level of a penalty.	39. - (1) The Director must prepare and publish guidance as to the appropriate amount of any penalty under this Part.
	(2) The Director may at any time alter the guidance.
	(3) If the guidance is altered, the Director must publish it as altered.
	(4) No guidance is to be published under this section without the approval of the Secretary of State.
	(5) The Director may, after consulting the Secretary of State, choose how he publishes his guidance.
	(6) If the Director is preparing or altering guidance under this section he must consult such persons as he considers appropriate.
	(7) If the proposed guidance or alteration relates to a matter in respect of which a regulator exercises concurrent jurisdiction, those consulted must include that regulator.
	(8) When setting the amount of a penalty under this Part, the Director, an appeal tribunal or the appropriate court must have regard to the guidance for the time being in force under this section.
	(9) If a penalty or a fine has been imposed by the Commission, or by a court or other body in another Member State, in respect of an agreement or conduct, the Director, an appeal tribunal or the appropriate court must take that penalty or fine into account when setting the amount of a penalty under this Part in relation to that agreement or conduct.
	(10) In subsections (8) and (9) "the appropriate court" means-
	(a) in relation to England and Wales, the Court of Appeal;
	(b) in relation to Scotland, the Court of Session;
	(c) in relation to Northern Ireland, the Court of Appeal in Northern Ireland;
	(d) the House of Lords.
Limited immunity for small agreements.	40. - (1) In this section "small agreement" means an agreement-
	(a) which falls within a category prescribed for the purposes of this section; but
	(b) is not a price fixing agreement.
	(2) The criteria by reference to which a category of agreement is prescribed may, in particular, include-
	(a) the combined turnover of the parties to the agreement (determined in accordance with prescribed provisions);
	(b) the share of the market affected by the agreement (determined in that way).
	(3) A party to a small agreement is immune from the effect of section 37(1); but the Director may withdraw that immunity under subsection (4).
	(4) If the Director has investigated a small agreement, he may make a decision withdrawing the immunity given by subsection (3) if, as a result of his investigation, he considers that the agreement is likely to infringe the Chapter I prohibition.
	(5) The Director must give each of the parties in respect of which immunity is withdrawn written notice of his decision to withdraw the immunity.
	(6) A decision under subsection (4) takes effect on such date ("the withdrawal date") as may be specified in the decision.
	(7) The withdrawal date must be a date after the date on which the decision is made.
	(8) In determining the withdrawal date, the Director must have regard to the amount of time which the parties are likely to require in order to secure that there is no further infringement of the Chapter I prohibition with respect to the agreement.
	(9) In subsection (1) "price fixing agreement" means an agreement which has as its object or effect, or one of its objects or effects, restricting the freedom of a party to the agreement to determine the price to be charged (otherwise than as between that party and another party to the agreement) for the product, service or other matter to which the agreement relates.

Prepared 10 March 1998