C6C7C8C9C16C14C15C12C11C13C17C18C19 Part I Competition
Pt. 1 (except ss. 38(1)-(6), 51) amended (1.2.2001) by 2000 c. 38, ss. 86(1)(3), 89 (with ss. 105(2)(d)(5), 106); S.I. 2001/57, art. 3(1), Sch. 2 Pt. 1
Pt. 1 (except ss. 38(1)-(6), 51, 52(6) and (8) and 54) amended (1.2.2001) by 2000 c. 38, s. 86(4)(b)(5) (with ss. 105(2)(d)(5), 106); S.I. 2001/57, art. 3(1), Sch. 2 Pt. 1
Pt. 1 (except ss. 38(1)-(6), 51) amended (1.2.2001) by 2000 c. 38, s. 86(7)(b) (with ss. 105(2)(d)(5), 106); S.I. 2001/57, art. 3(1), Sch. 2 Pt. 1
Pt. 1 modified (25.7.2003 for specified purposes, 29.12.2003 in so far as not already in force) by Communications Act 2003 (c. 21), ss. 371(3), 411(2) (with Sch. 18); S.I. 2003/1900, arts. 1(2), 2(1), Sch. 1 (with art. 3) (as amended by S.I. 2003/3142, art. 1(3)); S.I. 2003/3142, art. 3(2) (with art. 11)
Pt. 1 certain functions made exercisable concurrently by 1998 c. 41, s. 67(3) (as substituted (1.5.2004) by The Competition Act 1998 and Other Enactments (Amendment) Regulations 2004 (S.I. 2004/1261), reg. 1(a), Sch. 2 para. 6(2)(a))
Pt. 1 certain functions made exercisable concurrently by 1991 c. 56, s. 31(3) (as substituted (1.5.2004) by The Competition Act 1998 and Other Enactments (Amendment) Regulations 2004 (S.I. 2004/1261), reg. 1(a), Sch. 2 para. 4(2)(a))
Pt. 1 certain functions made exercisable concurrently by S.I. 1992/231 (N.I. 1) art. 46(3) (as substituted (1.5.2004) by The Competition Act 1998 and Other Enactments (Amendment) Regulations 2004 (S.I. 2004/1261), reg. 1(a), Sch. 2 para. 5(2)(a))
Pt. 1 certain functions made exercisable concurrently by 1986 c. 44, s. 36A(3) (as substituted (1.5.2004) by The Competition Act 1998 and Other Enactments (Amendment) Regulations 2004 (S.I. 2004/1261), reg. 1(a), Sch. 2 para. 1(2)(a))
Pt. 1 restricted (1.5.2004) by The Competition Act 1998 and Other Enactments (Amendment) Regulations 2004 (S.I. 2004/1261), regs. 1(a), 9(2)
Pt. 1 certain functions made exercisable concurrently by 1989 c. 29, s. 43(3) (as substituted (1.5.2004) by The Competition Act 1998 and Other Enactments (Amendment) Regulations 2004 (S.I. 2004/1261), reg. 1(a), Sch. 2 para. 3(2)(a))
Pt. 1 certain functions made exercisable concurrently by S.I. 1996/275 (N.I. 2), art. 23(3) (as substituted (1.5.2004) by The Competition Act 1998 and Other Enactments (Amendment) Regulations 2004 (S.I. 2004/1261), reg. 1(a), Sch. 2 para. 9(2)(a))
Pt. 1 certain functions made exercisable concurrently (1.4.2007) by The Water and Sewerage Services (Northern Ireland) Order 2006 (S.I. 2006/3336), arts. 1(2), 29(3) (with arts. 8(8), 121(3), 307); S.R. 2007/194, art. 2(2), Sch. Pt. 2 (with Sch. 2)
Pt. 1 modified (1.4.2007) by The Water and Sewerage Services (Northern Ireland) Order 2006 (S.I. 2006/3336), arts. 1(2), 29(5) (with arts. 8(8), 121(3), 307); S.R. 2007/194, art. 2(2), Sch. Pt. 2 (with Sch. 2)
Chapter I Agreements
Introduction
I11 Enactments replaced.
The following shall cease to have effect—
a
the Restrictive Practices Court Act 1976 (c. 33),
b
the Restrictive Trade Practices Act 1976 (c. 34),
c
the Resale Prices Act 1976 (c. 53), and
d
the Restrictive Trade Practices Act 1977 (c. 19).
The prohibition
2 Agreements etc. preventing, restricting or distorting competition.
C1C201
Subject to section 3, agreements between undertakings, decisions by associations of undertakings or concerted practices which—
a
may affect trade within the United Kingdom, and
b
have as their object or effect the prevention, restriction or distortion of competition within the United Kingdom,
are prohibited unless they are exempt in accordance with the provisions of this Part.
2
Subsection (1) applies, in particular, to agreements, decisions or practices which—
a
directly or indirectly fix purchase or selling prices or any other trading conditions;
b
limit or control production, markets, technical development or investment;
c
share markets or sources of supply;
d
apply dissimilar conditions to equivalent transactions with other trading parties, thereby placing them at a competitive disadvantage;
e
make the conclusion of contracts subject to acceptance by the other parties of supplementary obligations which, by their nature or according to commercial usage, have no connection with the subject of such contracts.
3
Subsection (1) applies only if the agreement, decision or practice is, or is intended to be, implemented in the United Kingdom.
4
Any agreement or decision which is prohibited by subsection (1) is void.
C105
A provision of this Part which is expressed to apply to, or in relation to, an agreement is to be read as applying equally to, or in relation to, a decision by an association of undertakings or a concerted practice (but with any necessary modifications).
6
Subsection (5) does not apply where the context otherwise requires.
7
In this section “the United Kingdom” means, in relation to an agreement which operates or is intended to operate only in a part of the United Kingdom, that part.
8
The prohibition imposed by subsection (1) is referred to in this Act as “the Chapter I prohibition”.
Excluded agreements
I23 Excluded agreements.
1
The Chapter I prohibition does not apply in any of the cases in which it is excluded by or as a result of—
a
Schedule 1 (mergers and concentrations);
b
Schedule 2 (competition scrutiny under other enactments);
c
Schedule 3 (planning obligations and other general exclusions). F17...
F1d
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2
The Secretary of State may at any time by order amend Schedule 1, with respect to the Chapter I prohibition, by—
a
providing for one or more additional exclusions; or
b
amending or removing any provision (whether or not it has been added by an order under this subsection).
3
The Secretary of State may at any time by order amend Schedule 3, with respect to the Chapter I prohibition, by—
a
providing for one or more additional exclusions; or
b
amending or removing any provision—
i
added by an order under this subsection; or
ii
included in paragraph 1, 2, 8 or 9 of Schedule 3.
4
The power under subsection (3) to provide for an additional exclusion may be exercised only if it appears to the Secretary of State that agreements which fall within the additional exclusion—
a
do not in general have an adverse effect on competition, or
5
An order under subsection (2)(a) or (3)(a) may include provision (similar to that made with respect to any other exclusion provided by the relevant Schedule) for the exclusion concerned to cease to apply to a particular agreement.
6
Schedule 3 also gives the Secretary of State power to exclude agreements from the Chapter I prohibition in certain circumstances.
Exemptions
4 Individual exemptions.
F191
The F2OFT may grant an exemption from the Chapter I prohibition with respect to a particular agreement if—
a
a request for an exemption has been made to F2it under section 14 by a party to the agreement; and
b
the agreement is one to which section 9 applies.
2
An exemption granted under this section is referred to in this Part as an individual exemption.
3
The exemption—
a
may be granted subject to such conditions or obligations as the F2OFT considers it appropriate to impose; and
b
has effect for such period as the F2OFT considers appropriate.
4
That period must be specified in the grant of the exemption.
5
An individual exemption may be granted so as to have effect from a date earlier than that on which it is granted.
6
5 Cancellation etc. of individual exemptions.
F201
If the F3OFT has reasonable grounds for believing that there has been a material change of circumstance since F3it granted an individual exemption, F3it may by notice in writing—
a
cancel the exemption;
b
vary or remove any condition or obligation; or
c
impose one or more additional conditions or obligations.
2
3
Breach of a condition has the effect of cancelling the exemption.
4
Failure to comply with an obligation allows the F3OFT, by notice in writing, to take any of the steps mentioned in subsection (1).
5
Any step taken by the F3OFT under subsection (1), (2) or (4) has effect from such time as may be specified in the notice.
6
If an exemption is cancelled under subsection (2) or (4), the date specified in the notice cancelling it may be earlier than the date on which the notice is given.
7
6 Block exemptions.
1
2
The Secretary of State may make an order (“a block exemption order”) giving effect to such a recommendation—
a
in the form in which the recommendation is made; or
b
subject to such modifications as he considers appropriate.
3
An agreement which falls within a category specified in a block exemption order is exempt from the Chapter I prohibition.
4
An exemption under this section is referred to in this Part as a block exemption.
5
A block exemption order may impose conditions or obligations subject to which a block exemption is to have effect.
6
A block exemption order may provide—
a
that breach of a condition imposed by the order has the effect of cancelling the block exemption in respect of an agreement;
b
that if there is a failure to comply with an obligation imposed by the order, the F4OFT may, by notice in writing, cancel the block exemption in respect of the agreement;
7
A block exemption order may provide that the order is to cease to have effect at the end of a specified period.
F238
In this section—
“exempt agreement” means an agreement which is exempt from the Chapter I prohibition as a result of section 9; and
“specified” means specified in a block exemption order.
7 Block exemptions: opposition.
F241
A block exemption order may provide that a party to an agreement which—
a
does not qualify for the block exemption created by the order, but
b
satisfies specified criteria,
may notify the F6OFT of the agreement for the purposes of subsection (2).
2
An agreement which is notified under any provision included in a block exemption order by virtue of subsection (1) is to be treated, as from the end of the notice period, as falling within a category specified in a block exemption order unless the F6OFT—
a
is opposed to its being so treated; and
b
gives notice in writing to the party concerned of F6its opposition before the end of that period.
3
4
In this section “notice period” means such period as may be specified with a view to giving the F6OFT sufficient time to consider whether to oppose under subsection (2).
8 Block exemptions: procedure.
1
Before making a recommendation under section 6(1), the F7OFT must—
a
b
consider any representations about it which are made to F8it.
2
3
4
Subsection (1) also applies to any proposed recommendation under subsection (3).
5
Before exercising F8its power to vary or revoke a block exemption order (in a case where there has been no recommendation under subsection (3)), the Secretary of State must—
a
inform the F7OFT of the proposed variation or revocation; and
b
take into account any comments made by the F7OFT.
6
A block exemption order may provide for a block exemption to have effect from a date earlier than that on which the order is made.
9F27Exempt agreements.
F251
F28An agreement is exempt from the Chapter I prohibition if it—
a
contributes to—
i
improving production or distribution, or
ii
promoting technical or economic progress,
while allowing consumers a fair share of the resulting benefit; F29and
b
does not—
i
impose on the undertakings concerned restrictions which are not indispensable to the attainment of those objectives; or
ii
afford the undertakings concerned the possibility of eliminating competition in respect of a substantial part of the products in question.
F262
In any proceedings in which it is alleged that the Chapter I prohibition is being or has been infringed by an agreement, any undertaking or association of undertakings claiming the benefit of subsection (1) shall bear the burden of proving that the conditions of that subsection are satisfied.
10 Parallel exemptions.
1
An agreement is exempt from the Chapter I prohibition if it is exempt from the Community prohibition—
a
by virtue of a Regulation, F31or
b
because of a decision of the Commission under Article 10 of the EC Competition Regulation.
2
An agreement is exempt from the Chapter I prohibition if it does not affect trade between Member States but otherwise falls within a category of agreement which is exempt from the Community prohibition by virtue of a Regulation.
3
An exemption from the Chapter I prohibition under this section is referred to in this Part as a parallel exemption.
4
A parallel exemption—
a
takes effect on the date on which the relevant exemption from the Community prohibition takes effect or, in the case of a parallel exemption under subsection (2), would take effect if the agreement in question affected trade between Member States; and
b
ceases to have effect—
i
if the relevant exemption from the the Community prohibition ceases to have effect; or
ii
on being cancelled by virtue of subsection (5) or (7).
5
In such circumstances and manner as may be specified in rules made under section 51, the F10OFT may—
a
impose conditions or obligations subject to which a parallel exemption is to have effect;
b
vary or remove any such condition or obligation;
c
impose one or more additional conditions or obligations;
d
cancel the exemption.
6
In such circumstances as may be specified in rules made under section 51, the date from which cancellation of an exemption is to take effect may be earlier than the date on which notice of cancellation is given.
7
Breach of a condition imposed by the F10OFT has the effect of cancelling the exemption.
8
9
For the purpose of this section references to an agreement being exempt from the Community prohibition are to be read as including references to the prohibition being inapplicable to the agreement by virtue of a Regulation F30other than the EC Competition Regulation or a decision by the Commission.
10
In this section—
“the Community prohibition” means the prohibition contained in—
- a
F33Article 101(1)
- b
any corresponding provision replacing, or otherwise derived from, that provision;
- c
such other Regulation as the Secretary of State may by order specify; and
- a
“Regulation” means a Regulation adopted by the Commission or by the Council.
11
This section has effect in relation to the prohibition contained in paragraph 1 of Article 53 of the EEA Agreement (and the EFTA Surveillance Authority) as it has effect in relation to the Community prohibition (and the Commission) subject to any modifications which the Secretary of State may by order prescribe.
11 Exemption for certain other agreements.
1
2
But the Secretary of State may by regulations make such provision as he considers appropriate for the purpose of granting an exemption from the Chapter I prohibition, in prescribed circumstances, in respect of such agreements.
3
An exemption from the Chapter I prohibition by virtue of regulations under this section is referred to in this Part as a section 11 exemption.
Notification
I312 Requests for F12OFT
to examine agreements.
F181
Sections 13 and 14 provide for an agreement to be examined by the F12OFT on the application of a party to the agreement who thinks that it may infringe the Chapter I prohibition.
2
Schedule 5 provides for the procedure to be followed—
a
by any person making such an application; and
b
by the F12OFT, in considering such an application.
3
The Secretary of State may by regulations make provision as to the application of sections 13 to 16 and Schedule 5, with such modifications (if any) as may be prescribed, in cases where the F12OFT—
a
has given a direction withdrawing an exclusion; or
b
is considering whether to give such a direction.
C213 Notification for guidance.
F181
A party to an agreement who applies for the agreement to be examined under this section must—
a
notify the F13OFT of the agreement; and
b
apply to F13the OFT for guidance.
2
3
If the F13OFT considers that the agreement is likely to infringe the prohibition if it is not exempt, F13its guidance may indicate—
a
whether the agreement is likely to be exempt from the prohibition under—
i
a block exemption;
ii
a parallel exemption; or
iii
a section 11 exemption; or
b
whether F13it would be likely to grant the agreement an individual exemption if asked to do so.
4
If an agreement to which the prohibition applies has been notified to the F13OFT under this section, no penalty is to be imposed under this Part in respect of any infringement of the prohibition by the agreement which occurs during the period—
a
beginning with the date on which notification was given; and
b
ending with such date as may be specified in a notice in writing given to the applicant by the F13OFT when the application has been determined.
5
The date specified in a notice under subsection (4)(b) may not be earlier than the date on which the notice is given.
C314Notification for a decision.
F181
A party to an agreement who applies for the agreement to be examined under this section must—
a
notify the F14OFT of the agreement; and
b
apply to F14the OFT for a decision.
2
On an application under this section, the F14OFT may make a decision as to—
a
whether the Chapter I prohibition has been infringed; and
b
if it has not been infringed, whether that is because of the effect of an exclusion or because the agreement is exempt from the prohibition.
3
If an agreement is notified to the F14OFT under this section, the application may include a request for the agreement to which it relates to be granted an individual exemption.
4
If an agreement to which the prohibition applies has been notified to the F14OFT under this section, no penalty is to be imposed under this Part in respect of any infringement of the prohibition by the agreement which occurs during the period—
a
beginning with the date on which notification was given; and
b
ending with such date as may be specified in a notice in writing given to the applicant by the F14OFT when the application has been determined.
5
The date specified in a notice under subsection (4)(b) may not be earlier than the date on which the notice is given.
C415 Effect of guidance.
F181
This section applies to an agreement if the F15OFT has determined an application under section 13 by giving guidance that—
a
the agreement is unlikely to infringe the Chapter I prohibition, regardless of whether or not it is exempt;
b
the agreement is likely to be exempt under—
i
a block exemption;
ii
a parallel exemption; or
iii
a section 11 exemption; or
c
F15it would be likely to grant the agreement an individual exemption if asked to do so.
2
The F15OFT is to take no further action under this Part with respect to an agreement to which this section applies, unless—
a
b
c
one of the parties to the agreement applies to F15it for a decision under section 14 with respect to the agreement; or
d
a complaint about the agreement has been made to F15it by a person who is not a party to the agreement.
3
No penalty may be imposed under this Part in respect of any infringement of the Chapter I prohibition by an agreement to which this section applies.
4
But the F15OFT may remove the immunity given by subsection (3) if—
a
F15it takes action under this Part with respect to the agreement in one of the circumstances mentioned in subsection (2);
b
F15it considers it likely that the agreement will infringe the prohibition; and
5
If the F15OFT has a reasonable suspicion that information—
b
which was provided to F15it by a party to the agreement,
was incomplete, false or misleading in a material particular, the date specified in a notice under subsection (4)(c) may be earlier than the date on which the notice is given.
C516 Effect of a decision that the Chapter I prohibition has not been infringed.
F181
This section applies to an agreement if the F16OFT has determined an application under section 14 by making a decision that the agreement has not infringed the Chapter I prohibition.
2
The F16OFT is to take no further action under this Part with respect to the agreement unless—
a
3
No penalty may be imposed under this Part in respect of any infringement of the Chapter I prohibition by an agreement to which this section applies.
4
But the F16OFT may remove the immunity given by subsection (3) if—
a
F16it takes action under this Part with respect to the agreement in one of the circumstances mentioned in subsection (2);
b
F16it considers that it is likely that the agreement will infringe the prohibition; and
5
If the F16OFT has a reasonable suspicion that information—
b
which was provided to F16it by a party to the agreement,
was incomplete, false or misleading in a material particular, the date specified in a notice under subsection (4)(c) may be earlier than the date on which the notice is given.
Pt. 1: certain functions made exercisable concurrently (26.11.1998 for certain purposes and prosp. otherwise) by 1984 c. 12, s. 50(3) (as substituted by 1998 c. 41, s. 66(5), Sch. 10 Pt. II para. 2(6) (with s. 73); S.I. 1998/2750, art. 2)