Competition Act 1998
| Jurisdiction | UK Non-devolved |
| Citation | 1998 c. 41 |
Competition Act 1998
1998 Chapter 41
An Act to make provision about competition and the abuse of a dominant position in the market to confer powers in relation to investigations conducted in connection with Article 85 or 86 of the treaty establishing the European Community to amend the Fair Trading Act 1973 in relation to information which may be required in connection with investigations under that Act to make provision with respect to the meaning of ‘supply of services’ in the Fair Trading Act 1973 and for connected purposes.
[9th November 1998]
B e it enacted by the Queen's most Excellent Majesty, by and with the advice and consent of the Lords Spiritual and Temporal, and Commons, in this present Parliament assembled, and by the authority of the same, as follows:—
Part I
COMPETITION
Chapter I
Agreements
Introduction
1 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
The prohibition
2 Agreements etc. preventing, restricting or distorting competition.
(1) 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.
(5) 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
3 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) or
(d) Schedule 4 (professional rules).
(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
(b) are, in general, best considered under Chapter II or the Fair Trading Act 1973 .
(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.
(1) The Director 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 him 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 Director considers it appropriate to impose and
(b) has effect for such period as the Director 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) On an application made in such way as may be specified by rules under section 51, the Director may extend the period for which an exemption has effect but, if the rules so provide, he may do so only in specified circumstances.
5 Cancellation etc. of individual exemptions.
(1) If the Director has reasonable grounds for believing that there has been a material change of circumstance since he granted an individual exemption, he 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) If the Director has a reasonable suspicion that the information on which he based his decision to grant an individual exemption was incomplete, false or misleading in a material particular, he may by notice in writing take any of the steps mentioned in subsection (1).
(3) Breach of a condition has the effect of cancelling the exemption.
(4) Failure to comply with an obligation allows the Director, by notice in writing, to take any of the steps mentioned in subsection (1).
(5) Any step taken by the Director 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) The Director may act under subsection (1), (2) or (4) on his own initiative or on a complaint made by any person.
6 Block exemptions.
(1) If agreements which fall within a particular category of agreement are, in the opinion of the Director, likely to be agreements to which section 9 applies, the Director may recommend that the Secretary of State make an order specifying that category for the purposes of this section.
(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 Director may, by notice in writing...
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