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| 1 minute read

Government launches consultation on wide-ranging competition policy and consumer protection reforms

The Reforming Competition and Consumer Policy paper issued today proposes reforms across 3 key areas: competition policy, consumer rights, and consumer law enforcement.  A few of the more eye-catching proposals include:

  • Boosting the CMA's ability to fine businesses for failing to comply with information gathering exercises, from a £30,000 fixed penalty and/or a daily rate of £15,000, to fixed penalties of up to 1% of a business’ annual turnover and an additional daily penalty of up to 5% of daily turnover while non-compliance continues. 
  • Offering the CMA the ability to accept commitments at any point in an investigation (instead of just towards the end) and even to accept commitments that only address part of an investigation, on the basis that narrowing the scope of the investigation will also help avoid costs and delay for both the CMA and businesses.  
  • Creating a merger safe harbour whereby if the worldwide turnover of each of the merging parties is less than £10m, the transaction is excluded from the CMA’s jurisdiction even if the merger would otherwise qualify for review under the share of supply test.
  • Introducing fines of up to 10% of global turnover for traders that breach consumer protection law. 

The 147 page paper covers a lot of ground and will undoubtedly contain more proposals of interest. However, even those few points identified above suggest that we could be in for some fairly significant changes to how competition policy and consumer protection laws are enforced. The consultation closes on 1 October 2021.

The proposals come in the new consultation on Reforming Competition and Consumer Policy, which delivers on the government’s manifesto commitment to “give the Competition and Markets Authority enhanced powers to tackle consumer rip-offs and bad business practices.”


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