Guidance

Collaborating with other businesses

Published 15 August 2025

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If you’re a business thinking about working with another business to achieve a shared goal, it’s important to understand some key parts of competition law so that you can stay on the right side of the law. Competition law helps ensure that business collaborations are fair and don’t harm competition in the market.    

Many collaborations between businesses do not raise any competition law concerns. Indeed, many collaborations are good for competition because they lead to benefits for customers, such as innovation or improved efficiency.   

However, in some circumstances a collaboration may be illegal because it crosses the line into anticompetitive behaviour.   

Assessing whether or not collaborations between businesses risk falling foul of competition law can sometimes be tricky. This guidance aims to provide some high-level pointers to assist you.  

The Competition Act 1998  

The main law governing competition in the UK is the Competition Act 1998 (the ‘CA98’).   

The CA98 contains 2 prohibitions:  

  • the Chapter I prohibition on anticompetitive agreements 

  • the Chapter II prohibition on abuse of a dominant position 

When 2 or more businesses work together, competition law treats this as an agreement between those businesses. If that agreement limits competition, it could be illegal under the Chapter I prohibition.  

Types of agreement 

In competition law, agreements are often described as being ‘horizontal’ or ‘vertical’, depending on the relationship between the parties involved:  

  • horizontal agreements occur between businesses that operate in the same market and at the same level of the supply chain (meaning that they are direct competitors) or are likely to do so in the near future (referred to as potential competitors)  

  • vertical agreements involve businesses operating at different levels of the supply chain, such as a manufacturer and a retailer 

Collaborations between businesses are often horizontal agreements, but both types can raise legal issues depending on how they affect competition.   

Common types of horizontal collaborations between businesses include:  

  • research and development, for example to develop or improve a product or technology  

  • production, for example sharing resources to produce something together, including through joint ventures 

  • specialisation, for example 2 businesses agreeing that one will give up producing something and instead purchase it from the other   

  • purchasing, for example jointly negotiating and purchasing from suppliers  

  • commercialisation, for example working together to bring a new product to market  

  • information exchange, for example sharing information so that businesses can benchmark against each other’s best practices  

  • standardisation, for example developing a product standard 

Whether or not these are allowed under competition law will depend on the circumstances. In many cases, business collaborations do not limit competition and are allowed under competition law. Even where they limit competition, they may benefit from exemptions under competition law because of the efficiencies they provide. This is explained further below.  

The CMA has published detailed guidance on how competition law applies to different types of horizontal agreements.  

Exemptions  

Sometimes, a business agreement isn’t illegal even though it limits competition. This can happen if the agreement qualifies for an exemption under competition law. In these cases, the agreement is not considered to breach the Chapter I prohibition.   

The section 9 exemption  

Under section 9 of the CA98, an agreement may be exempt if it meets certain conditions relating to the efficiencies and benefits of the agreement.   

This usually requires a legal assessment. More information is available in the CMA’s guidance on horizontal agreements. 

Block exemptions  

Certain categories of agreement are covered by block exemptions. This is because the CMA considers that the agreements in question are likely to satisfy the conditions for a section 9 exemption. A business agreement is automatically allowed under competition law if it meets the specific criteria set out in the block exemption.  

If your business collaboration fits within a block exemption, you can be confident it follows the law. You will not need a separate legal assessment under section 9 of the CA98. However, each block exemption has its own set of rules and conditions. You must meet all of these to benefit from the exemption.  

There are currently several block exemptions in the UK, including in relation to the following types of business collaboration:  

If your collaboration doesn’t qualify for a block exemption, it might still be legal under section 9 – but you’ll need to assess it more carefully to be sure.   

Mergers 

Collaborations that lead to mergers between businesses may also be caught by competition law and require investigation by the CMA to determine whether they are likely to reduce competition. See Mergers: how they are investigated to find out more about what would count as a ‘merger’, the circumstances in which the CMA will investigate, and how our investigations work. 

Next steps

If you want to find out more, read our guidance on:

For publications on specific sectors, please refer to:

If you have specific questions or concerns, you may need to seek specialist legal advice.  

It may be possible for businesses to obtain free legal advice from organisations such as the Competition Pro Bono scheme.    

While we can’t provide legal advice, we may be able to step in if there is evidence that businesses are being put off collaborating in ways that may be beneficial to consumers or the wider economy because of uncertainty about how competition law applies. Where this is the case, please let us know by emailing collaborations@cma.gov.uk.

We would be particularly interested to hear from businesses in the 8 key industrial strategy sectors. We will consider any such submissions carefully, although we are unlikely to be able to take action in every case. We will consider, in line with our published prioritisation principles, whether it would be appropriate to take further action in individual cases.

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