C4C13C14C15C16C5C6C7C9C11C10C12C17Part 3Mergers
Pt. 3 applied (with modifications) (29.12.2004) by Water Industry Act 1991 (c. 56), Sch. 4ZA paras. 1, 2 (as inserted by Enterprise Act 2002 (c. 40), ss. 70(2), 279, Sch. 6); S.I. 2004/3233, art. 2, Sch. (with transitional provisions and savings in arts. 3-5)
Pt. 3 (ss. 22-130) applied (1.10.2005) by Water Industry Act 1991 (c. 56), s. 17M(4) (as inserted by Water Act 2003 (c. 37), ss. 56, 105(3), Sch. 4 para. 2); S.I. 2005/2714, art. 2(h) (with Sch. para. 5)
Pt. 3 applied (1.10.2005) by Water Industry Act 1991 (c. 56), s. 17Q(9) (as inserted by Water Act 2003 (c. 37), ss. 56, 105(3), Sch. 4 para. 2); S.I. 2005/2714, art. 2(h) (with Sch. para. 5)
Pt. 3 applied in part (N.I.) (1.4.2007) by The Water and Sewerage Services (Northern Ireland) Order 2006 (S.I. 2006/3336 (N.I. 21)), arts. 1(2)(3), 23(4), 27(9); S.R. 2007/194, art. 2(2), Sch. 1 Pt. 2 (with Sch. 2)
Pt. 3 excluded in part (29.9.2008) by The Bradford & Bingley plc Transfer of Securities and Property etc. Order 2008 (S.I. 2008/2546), arts. 1(2), 40
Pt. 3 modified (1.7.2012) by Health and Social Care Act 2012 (c. 7), ss. 79, 306(4); S.I. 2012/1319, art. 2(3)
Pt. 3 modified (1.4.2014) by Enterprise and Regulatory Reform Act 2013 (c. 24), s. 103(3), Sch. 4 para. 56; S.I. 2014/416, art. 2(1)(c) (with Sch.)
Pt. 3 modified (31.12.2020) by The Competition (Amendment etc.) (EU Exit) Regulations 2019 (S.I. 2019/93), reg. 1(1), Sch. 4 paras. 28-33; 2020 c. 1, Sch. 5 para. 1(1)
Pt. 3 excluded (28.6.2022) by 1992 c. 13, s. 56E(9B) (as inserted (E.W.) by Skills and Post-16 Education Act 2022 (c. 21), ss. 23(3)(f), 36(2))
Pt. 3 excluded (28.6.2022) by 1992 c. 13, s. 56A(9B) (as inserted (E.W.) by Skills and Post-16 Education Act 2022 (c. 21), ss. 23(2)(f), 36(2))
Pt. 3 modified (1.7.2022) by 2006 c. 41, s. 72A (as inserted by Health and Care Act 2022 (c. 31), ss. 83(1), 186(6); S.I. 2022/734, reg. 2(a), Sch. (with regs. 13, 29, 30))
Pt. 3 modified (E.W.) (29.12.2004) by The Water Mergers (Modification of Enactments) Regulations 2004 (S.I. 2004/3202), regs. 2-35 (as amended (1.4.2014) by S.I. 2014/549, art. 1(1), Sch. 1 para. 22 (with art. 3); (18.12.2015) by S.I. 2015/1936, regs. 1, 3-20; (6.12.2023) by S.I. 2023/1185, arts. 1(2), 9-27)
C7C9Chapter 1Duty to make references
Determination of references
34CC8F5Functions to be exercised by CMA groups
1
Where a reference is made to the chair of the CMA under section 22 or 33 for the constitution of a group under Schedule 4 to the Enterprise and Regulatory Reform Act 2013, the functions of the CMA under or by virtue of the following provisions of this Part in relation to the matter concerned are to be carried out on behalf of the CMA by the group so constituted—
a
sections 35 to 41B, except for sections 35(6) and (7), 36(5) and (6) and 37(6);
b
where a reference is treated by virtue of section 37(2) as having been made under section 22, section 23(9)(a);
c
section 76, as it applies in relation to orders under section 83, and sections 77, 78 and 80 to 84;
d
section 87, so far as relating to an enforcement order made on behalf of the CMA by the group;
e
sections 92(4), 94 and 94A, so far as relating to an enforcement undertaking or enforcement order made on behalf of the CMA by the group;
f
section 104, so far as relating to a decision mentioned in paragraph (a)(iii) of the definition of relevant decision in subsection (6) of that section;
g
section 107, so far as relating to anything done on behalf of the CMA by the group;
h
section 109, where the permitted purpose in question relates to a function that (by virtue of this section) is being or is to be carried out on behalf of the CMA by the group;
i
sections 110 to 115, so far as relating to a notice given under section 109 on behalf of the CMA by the group;
j
section 120(5)(b), so far as relating to a decision of the group;
k
Schedule 10, so far as relating to an enforcement undertaking or enforcement order which the group is considering accepting or making, or which the group has accepted or made, on behalf of the CMA.
2
The functions of the CMA under section 95(4) in relation to the matter concerned may be carried out on behalf of the CMA by the group.
3
Nothing in subsection (1) prevents the CMA Board from exercising a function of the CMA under or by virtue of the following provisions of this Part where the group constituted as mentioned in subsection (1) has ceased to exist—
a
section 76 and Schedule 10, so far as relating to the making of an order under section 76 in relation to an order under section 83;
b
section 83 and Schedule 10, so far as relating to the making of an order under section 83;
c
sections 76 (as it applies in relation to an order under section 83), 80 to 84 and Schedule 10, so far as relating to the variation, supersession or release of enforcement undertakings or the variation or revocation of enforcement orders;
d
section 87;
e
sections 92(4) and 94.
C135C7 Questions to be decided in relation to completed mergers
1
Subject to subsections (6) and (7) and section 127(3), the F11CMA shall, on a reference under section 22, decide the following questions—
a
whether a relevant merger situation has been created; and
b
if so, whether the creation of that situation has resulted, or may be expected to result, in a substantial lessening of competition within any market or markets in the United Kingdom for goods or services.
2
For the purposes of this Part there is an anti-competitive outcome if—
a
a relevant merger situation has been created and the creation of that situation has resulted, or may be expected to result, in a substantial lessening of competition within any market or markets in the United Kingdom for goods or services; or
b
arrangements are in progress or in contemplation which, if carried into effect, will result in the creation of a relevant merger situation and the creation of that situation may be expected to result in a substantial lessening of competition within any market or markets in the United Kingdom for goods or services.
3
The F6CMA shall, if it has decided on a reference under section 22 that there is an anti-competitive outcome (within the meaning given by subsection (2)(a)), decide the following additional questions—
a
whether action should be taken by it under section 41(2) for the purpose of remedying, mitigating or preventing the substantial lessening of competition concerned or any adverse effect which has resulted from, or may be expected to result from, the substantial lessening of competition;
b
whether it should recommend the taking of action by others for the purpose of remedying, mitigating or preventing the substantial lessening of competition concerned or any adverse effect which has resulted from, or may be expected to result from, the substantial lessening of competition; and
c
in either case, if action should be taken, what action should be taken and what is to be remedied, mitigated or prevented.
4
In deciding the questions mentioned in subsection (3) the F6CMA shall, in particular, have regard to the need to achieve as comprehensive a solution as is reasonable and practicable to the substantial lessening of competition and any adverse effects resulting from it.
5
In deciding the questions mentioned in subsection (3) the F6CMA may, in particular, have regard to the effect of any action on any relevant customer benefits in relation to the creation of the relevant merger situation concerned.
6
In relation to the question whether a relevant merger situation has been created, a reference under section 22 may be framed so as to require the F6CMA to exclude from consideration—
a
subsection (1) of section 23;
b
subsection (2) of that section; or
c
one of those subsections if the F6CMA finds that the other is satisfied.
7
C236C7 Questions to be decided in relation to anticipated mergers
1
Subject to subsections (5) and (6) and section 127(3), the F7CMA shall, on a reference under section 33, decide the following questions—
a
whether arrangements are in progress or in contemplation which, if carried into effect, will result in the creation of a relevant merger situation; and
b
if so, whether the creation of that situation may be expected to result in a substantial lessening of competition within any market or markets in the United Kingdom for goods or services.
2
The F7CMA shall, if it has decided on a reference under section 33 that there is an anti-competitive outcome (within the meaning given by section 35(2)(b)), decide the following additional questions—
C3a
whether action should be taken by it under section 41(2) for the purpose of remedying, mitigating or preventing the substantial lessening of competition concerned or any adverse effect which may be expected to result from the substantial lessening of competition;
C3b
whether it should recommend the taking of action by others for the purpose of remedying, mitigating or preventing the substantial lessening of competition concerned or any adverse effect which may be expected to result from the substantial lessening of competition; and
c
in either case, if action should be taken, what action should be taken and what is to be remedied, mitigated or prevented.
3
In deciding the questions mentioned in subsection (2) the F7CMA shall, in particular, have regard to the need to achieve as comprehensive a solution as is reasonable and practicable to the substantial lessening of competition and any adverse effects resulting from it.
4
In deciding the questions mentioned in subsection (2) the F7CMA may, in particular, have regard to the effect of any action on any relevant customer benefits in relation to the creation of the relevant merger situation concerned.
5
In relation to the question whether a relevant merger situation will be created, a reference under section 33 may be framed so as to require the F7CMA to exclude from consideration—
a
subsection (1) of section 23;
b
subsection (2) of that section; or
c
one of those subsections if the F7CMA finds that the other is satisfied.
6
37C7 Cancellation and variation of references under section 22 or 33
1
The F8CMA shall cancel a reference under section 33 if it considers that the proposal to make arrangements of the kind mentioned in the reference has been abandoned.
2
The F8CMA may, if it considers that doing so is justified by the facts (including events occurring on or after the making of the reference concerned), treat a reference made under section 22 or 33 as if it had been made under section 33 or (as the case may be) 22; and, in such cases, references in this Part to references under those sections shall, so far as may be necessary, be construed accordingly.
3
Where, by virtue of subsection (2), the F8CMA treats a reference made under section 22 or 33 as if it had been made under section 33 or (as the case may be) 22, sections 77 to 81 shall, in particular, apply as if the reference had been made under section 33 or (as the case may be) 22 instead of under section 22 or 33.
4
Subsection (5) applies in relation to any undertaking accepted under section 80, or any order made under section 81, which is in force immediately before the F8CMA, by virtue of subsection (2), treats a reference made under section 22 or 33 as if it had been made under section 33 or (as the case may be) 22.
5
The undertaking or order shall, so far as applicable, continue in force as if—
a
in the case of an undertaking or order which relates to a reference made under section 22, accepted or made in relation to a reference made under section 33; and
b
in the case of an undertaking or order which relates to a reference made under section 33, accepted or made in relation to a reference made under section 22;
and the undertaking or order concerned may be varied, superseded, released or revoked accordingly.
6
The F12CMA may at any time vary a reference under section 22 or 33.
F137
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
F138
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
9
38C7 Investigations and reports on references under section 22 or 33
1
The F9CMA shall prepare and publish a report on a reference under section 22 or 33 within the period permitted by section 39.
2
The report shall, in particular, contain—
a
the decisions of the F9CMA on the questions which it is required to answer by virtue of section 35 or (as the case may be) 36;
b
its reasons for its decisions; and
c
such information as the F9CMA considers appropriate for facilitating a proper understanding of those questions and of its reasons for its decisions.
3
The F9CMA shall carry out such investigations as it considers appropriate for the purposes of preparing a report under this section.
F224
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
39C7 Time-limits for investigations and reports
1
The F17CMA shall prepare and publish its report under section 38 within the period of 24 weeks beginning with the date of the reference concerned.
2
F1Where article 9(6) of the European Merger Regulations applies in relation to the reference under section 22 or 33, the Commission shall prepare and publish its report under section 38—
a
within the period of 24 weeks beginning with the date of the reference; or
b
if it is a shorter period, within such period as is necessary to ensure compliance with that article.
3
The F17CMA may extend, by no more than 8 weeks, the period within which a report under section 38 is to be prepared and published if it considers that there are special reasons why the report cannot be prepared and published within that period.
4
The F18CMA may extend the period within which a report under section 38 is to be prepared and published if it considers that a relevant person has failed (whether with or without a reasonable excuse) to comply with any requirement of a notice under section 109.
5
In F19this section “relevant person” means—
a
any person carrying on any of the enterprises concerned;
b
any person who (whether alone or as a member of a group) owns or has control of any such person; or
c
any officer, employee or agent of any person mentioned in paragraph (a) or (b).
6
For the purposes of subsection (5) a person or group of persons able, directly or indirectly, to control or materially to influence the policy of a body of persons corporate or unincorporate, but without having a controlling interest in that body of persons, may be treated as having control of it.
7
An extension under subsection (3) or (4) shall come into force when published under section 107.
8
An extension under subsection (4) shall continue in force until—
a
b
the F18CMA publishes its decision to cancel the extension.
F168A
In the case of a report on a reference under section 33, the CMA may provide that a specified period of no more than 3 weeks is to be disregarded for the purposes of any time-limit for the preparation and publication of the report which applies by virtue of this section if—
a
a relevant person has so requested before the end of the period of 3 weeks beginning with the date of the reference concerned; and
b
the CMA reasonably believes that the arrangements in question might be abandoned.
8B
If the CMA exercises the power under subsection (8A), the CMA shall publish a notice to that effect.
9
References in this Part to the date of a reference shall be construed as references to the date specified in the reference as the date on which it is made.
10
This section is subject to section 40.
40C7 Section 39: supplementary
1
F2No extension is possible under subsection (3) or (4) of section 39 where the period within which the report is to be prepared and published is determined by virtue of subsection (2)(b) of that section.
2
F2Where the period within which the report is to be prepared and published is determined by virtue of subsection (2)(a) of section 39, no extension is possible under subsection (3) or (4) of that section which extends that period beyond such period as is necessary to ensure compliance with article 9(6) of the European Merger Regulations.
3
A period extended under subsection (3) of section 39 may also be extended under subsection (4) of that section and a period extended under subsection (4) of that section may also be extended under subsection (3) of that section.
4
No more than one extension is possible under section 39(3).
5
Where a period within which a report under section 38 is to be prepared and published is extended or further extended under section 39(3) or (4), the period as extended or (as the case may be) further extended shall, subject to subsections (6) and (7), be calculated by taking the period being extended and adding to it the period of the extension (whether or not those periods overlap in time).
6
Subsection (7) applies where—
a
the period within which the report under section 38 is to be prepared and published is further extended;
b
the further extension and at least one previous extension is made under section 39(4); and
c
the same days or fractions of days are included in or comprise the further extension and are included in or comprise at least one such previous extension.
7
In calculating the period of the further extension, any days or fractions of days of the kind mentioned in subsection (6)(c) shall be disregarded.
8
The Secretary of State may by order amend section 39 so as to alter any one or more of the following periods—
a
the period of 24 weeks mentioned in subsection (1) of that section or any period for the time being mentioned in that subsection in substitution for that period;
b
F2the period of 24 weeks mentioned in subsection (2)(a) of that section or any period for the time being mentioned in that subsection in substitution for that period;
c
the period of 8 weeks mentioned in subsection (3) of that section or any period for the time being mentioned in that subsection in substitution for that period.
9
No alteration shall be made by virtue of subsection (8) which results in the period for the time being mentioned in subsection (1)
F3or (2)(a) of section 39 exceeding 24 weeks or the period for the time being mentioned in subsection (3) of that section exceeding 8 weeks.
10
An order under subsection (8) shall not affect any period of time within which the F20CMA is under a duty to prepare and publish its report under section 38 in relation to a reference under section 22 or 33 if the F20CMA is already under that duty in relation to that reference when the order is made.
11
Before making an order under subsection (8) the Secretary of State shall consult the F20CMA and such other persons as he considers appropriate.
12
The Secretary of State may make regulations for the purposes of section 39(8).
13
The regulations may, in particular—
a
provide for the time at which information or documents are to be treated as provided (including the time at which they are to be treated as provided to the satisfaction of the F21CMA for the purposes of section 39(8));
b
provide for the time at which a person is to be treated as appearing as a witness (including the time at which he is to be treated as appearing as a witness in accordance with the requirements of the F21CMA for the purposes of section 39(8));
c
provide for the persons carrying on the enterprises which have or may have ceased to be, or may cease to be, distinct enterprises to be informed, in circumstances in which section 39(8) applies, of the fact that—
i
the F21CMA is satisfied as to the provision of the information or documents required by it; or
ii
the person concerned has appeared as a witness in accordance with the requirements of the F21CMA;
d
provide for the persons carrying on the enterprises which have or may have ceased to be, or may cease to be, distinct enterprises to be informed, in circumstances in which section 39(8) applies, of the time at which the F21CMA is to be treated as satisfied as mentioned in paragraph (c)(i) above or the person concerned is to be treated as having appeared as mentioned in paragraph (c)(ii) above.
41C7 Duty to remedy effects of completed or anticipated mergers
1
Subsection (2) applies where a report of the F10CMA has been prepared and published under section 38 within the period permitted by section 39 and contains the decision that there is an anti-competitive outcome.
2
The F10CMA shall take such action under section 82 or 84 as it considers to be reasonable and practicable—
a
to remedy, mitigate or prevent the substantial lessening of competition concerned; and
b
to remedy, mitigate or prevent any adverse effects which have resulted from, or may be expected to result from, the substantial lessening of competition.
3
The decision of the F10CMA under subsection (2) shall be consistent with its decisions as included in its report by virtue of section 35(3) or (as the case may be) 36(2) unless there has been a material change of circumstances since the preparation of the report or the F10CMA otherwise has a special reason for deciding differently.
4
In making a decision under subsection (2), the F10CMA shall, in particular, have regard to the need to achieve as comprehensive a solution as is reasonable and practicable to the substantial lessening of competition and any adverse effects resulting from it.
5
In making a decision under subsection (2), the F10CMA may, in particular, have regard to the effect of any action on any relevant customer benefits in relation to the creation of the relevant merger situation concerned.
C741AC7F4Time-limit for discharging duty under section 41
1
The CMA shall discharge its duty under section 41(2) within the period of 12 weeks beginning with the date on which it publishes the report concerned under section 38.
2
The CMA may extend, by no more than 6 weeks, the period within which its duty under section 41(2) shall be discharged if it considers that there are special reasons for doing so.
3
The CMA may extend the period within which its duty under section 41(2) shall be discharged if it considers that a relevant person has failed (whether with or without reasonable excuse) to comply with any requirement of a notice under section 109 which is given in relation to the reference.
4
In subsection (3), “relevant person” means—
a
any person carrying on any of the enterprises concerned;
b
any person who (whether alone or as a member of a group) owns or has control of any such person; or
c
any officer, employee or agent of any person mentioned in paragraph (a) or (b).
5
For the purposes of subsection (4), a person or group of persons able, directly or indirectly, to control or materially to influence the policy of a body of persons corporate or unincorporate, but without having a controlling interest in that body of persons, may be treated as having control of it.
6
An extension under subsection (2) or (3) comes into force when published under section 107.
7
An extension under subsection (3) continues in force until—
a
the person concerned provides the information or documents to the satisfaction of the CMA or (as the case may be) appears as a witness in accordance with the requirements of the CMA; or
b
the CMA publishes its decision to cancel the extension.
C741BC7Section 41A: supplementary
1
A period extended under section 41A(2) may also be extended under section 41A(3), and a period extended under section 41A(3) may also be extended under section 41A(2).
2
No more than one extension is possible under section 41A(2).
3
Where a period is extended or further extended under section 41A(2) or (3), the period as extended or (as the case may be) further extended is, subject to subsections (4) and (5), to be calculated by taking the period being extended and adding to it the period of the extension (whether or not those periods overlap in time).
4
Subsection (5) applies where—
a
the period within which the CMA must discharge its duty under section 41(2) is further extended;
b
the further extension and at least one previous extension is made under section 41A(3); and
c
the same days or fractions of days are included in or comprise the further extension and are included in or comprise at least one such previous extension.
5
In calculating the period of the further extension, any days or fractions of days of the kind mentioned in subsection (4)(c) are to be disregarded.
6
The Secretary of State may by order amend section 41A so as to alter either or both of the following periods—
a
the period of 12 weeks mentioned in subsection (1) of that section or any period for the time being mentioned in that subsection in substitution for that period;
b
the period of 6 weeks mentioned in subsection (2) of that section or any period for the time being mentioned in that subsection in substitution for that period.
7
But no alteration may be made by virtue of subsection (6) which results in—
a
the period for the time being mentioned in section 41A(1) exceeding 12 weeks; or
b
the period for the time being mentioned in section 41A(2) exceeding 6 weeks.
8
Before making an order under subsection (6) the Secretary of State shall consult the CMA and such other persons as the Secretary of State considers appropriate.
Pt. 3 (ss. 22-130) modified (20.6.2003) by 1998 c. 41, Sch. 7 para. 20(3) (as substituted by Enterprise Act 2002 (c. 40), ss. 185, 279, {Sch. 11 para. 11(2)-(4)(8)}; S.I. 2003/1397, art. 2(1), Sch. (with art. 8)