The announcement follows an extensive consultation, which identified that the majority of respondents felt the current regime is too complicated and contains a lot of duplication.
The new independent body will bring together the Competition Commission (CC) and the competition functions of the Office of Fair Trading (OFT) to form the Competition and Markets Authority (CMA).
The move is designed to make the competition regime more effective and efficient by streamlining procedures, increasing the deterrent effect of the regime and making it less burdensome on business. This will be achieved by reforming competition law and strengthening enforcement processes. It is currently expected that the authority will be fully operating by April 2014.
The CMA will have a primary duty to promote effective competition in markets, across the UK economy and for the benefit of consumers. This includes responsibility for merger regulation, market investigations, cartel and antitrust cases, as well as a number of functions with respect to the regulated utilities.
The new structure will deliver:
Greater coherence in competition practice and a more streamlined approach in decision making across the regime, through strong oversight of cases by the single CMA.
More flexibility in prioritising cases and using resources to address the most important competition problems of the day, and for sector regulators, better incentives to use antitrust and markets tools to deal with competition problems.
Faster, less burdensome processes for business.
A single strong centre of competition expertise, which can provide leadership for the sector regulators on competition enforcement and a single authoritative voice for the UK internationally.
Increased accountability and transparency.
Taken together, these changes will lead to benefits for consumers and will help to stimulate UK productivity and growth.
Business Minister Norman Lamb said:
“Competition is a key driver of growth, allowing the most efficient and innovative businesses to thrive, grow and enter new markets. We already have a highly-regarded competition structure but there is still scope for improvements.
“We want to see a simpler, more streamlined structure so that a single competition authority can provide strong leadership and improve the speed and quality of decisions for business. Above all competition drives prices down and quality up, which benefits consumers and improves UK productivity and growth.”
The Government will legislate for the establishment of a CMA Board responsible for overall governance, strategy and performance.
The board will be required to publish rules and guidance describing its procedures and decision-making, to ensure clear roles, openness and transparency.
Notes to editors:
You can read the full response at http://www.bis.gov.uk/Consultations/competition-regime-for-growth?cat=closedwithresponse
The CMA will be independent of Government and constituted as a Non Ministerial Department (NMD). This status will ensure that the CMA is free from influence from Ministers, whilst also ensuring transparency in decision making and sound accountability. The CMA’s CEO and Board will be accountable directly to Parliament. and the CMA will be required to consult on its planned work and set out at the end of the year how it has performed.
A response to the consumer landscape consultation, which will further clarify the scope of the CMA with regards to its consumer functions, will follow in the near future.
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Notes to Editors
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