Competition Act 1998 (c. 41)

(The document as of February, 2008)

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(a) provide that "the supply of services" in the provisions of this Act is to include, or to cease to include, any activity specified in the order which consists in, or in making arrangements in connection with, permitting the use of land; and

(b) for that purpose, amend or repeal any of paragraphs (c), (d), (e) or (g) of subsection (3) above.

(3B) No order under subsection (3A) above is to be made unless a draft of the order has been laid before Parliament and approved by a resolution of each House of Parliament.

(3C) The provisions of Schedule 9 to this Act apply in the case of a draft of any such order as they apply in the case of a draft of an order to which section 91(1) above applies. "

69 Reports: monopoly references

In section 83 of the [1973 c. 41.] Fair Trading Act 1973--

(a) in subsection (1), omit "Subject to subsection (1A) below"; and

(b) omit subsection (1A) (reports on monopoly references to be transmitted to certain persons at least twenty-four hours before laying before Parliament).

Part IV Supplemental and Transitional

70 Contracts as to patented products etc

Sections 44 and 45 of the [1977 c. 37.] Patents Act 1977 shall cease to have effect.

71 Regulations, orders and rules

(1) Any power to make regulations or orders which is conferred by this Act is exercisable by statutory instrument.

(2) The power to make rules which is conferred by section 48 is exercisable by statutory instrument.

(3) Any statutory instrument made under this Act may--

(a) contain such incidental, supplemental, consequential and transitional provision as the Secretary of State considers appropriate; and

(b) make different provision for different cases.

(4) No order is to be made under--

(a) section 3,

(b) section 19,

(d) section 50, or

(e) paragraph 6(3) of Schedule 4,

unless a draft of the order has been laid before Parliament and approved by a resolution of each House.

(5) Any statutory instrument made under this Act, apart from one made--

(a) under any of the provisions mentioned in subsection (4), or

(b) under section 76(3),

shall be subject to annulment by a resolution of either House of Parliament.

72 Offences by bodies corporate etc

(1) This section applies to an offence under any of sections 42 to 44, 55(8) or 65.

(2) If an offence committed by a body corporate is proved--

(a) to have been committed with the consent or connivance of an officer, or

(b) to be attributable to any neglect on his part,

the officer as well as the body corporate is guilty of the offence and liable to be proceeded against and punished accordingly.

(3) In subsection (2) "officer", in relation to a body corporate, means a director, manager, secretary or other similar officer of the body, or a person purporting to act in any such capacity.

(4) If the affairs of a body corporate are managed by its members, subsection (2) applies in relation to the acts and defaults of a member in connection with his functions of management as if he were a director of the body corporate.

(5) If an offence committed by a partnership in Scotland is proved--

(a) to have been committed with the consent or connivance of a partner, or

(b) to be attributable to any neglect on his part,

the partner as well as the partnership is guilty of the offence and liable to be proceeded against and punished accordingly.

(6) In subsection (5) "partner" includes a person purporting to act as a partner.

73 Crown application

(1) Any provision made by or under this Act binds the Crown except that--

(a) the Crown is not criminally liable as a result of any such provision;

(b) the Crown is not liable for any penalty under any such provision; and

(2) Subsection (1)(a) does not affect the application of any provision of this Act in relation to persons in the public service of the Crown.

(3) Subsection (1)(c) is to be interpreted as if section 38(3) of the [1947 c. 44.] Crown Proceedings Act 1947 (interpretation of references in that Act to Her Majesty in her private capacity) were contained in this Act.

(4) If, in respect of a suspected infringement of the Chapter I prohibition or of the Chapter II prohibition otherwise than by the Crown or a person in the public service of the Crown, an investigation is conducted under section 25--

(a) the power conferred by section 27 may not be exercised in relation to land which is occupied by a government department, or otherwise for purposes of the Crown, without the written consent of the appropriate person; and

(b) section 28 does not apply in relation to land so occupied.

(5) In any case in which consent is required under subsection (4), the person who is the appropriate person in relation to that case is to be determined in accordance with regulations made by the Secretary of State.

(6) Sections 62 and 63 do not apply in relation to land which is occupied by a government department, or otherwise for purposes of the Crown, unless the matter being investigated is a suspected infringement by the Crown or by a person in the public service of the Crown.

(7) In subsection (6) "infringement" means an infringement of Community law relating to Article 85 or 86 of the Treaty establishing the European Community.

(8) If the Secretary of State certifies that it appears to him to be in the interests of national security that the powers of entry--

(a) conferred by section 27, or

(b) that may be conferred by a warrant under section 28, 62 or 63,

should not be exercisable in relation to premises held or used by or on behalf of the Crown and which are specified in the certificate, those powers are not exercisable in relation to those premises.

(9) Any amendment, repeal or revocation made by this Act binds the Crown to the extent that the enactment amended, repealed or revoked binds the Crown.

74 Amendments, transitional provisions, savings and repeals

(1) The minor and consequential amendments set out in Schedule 12 are to have effect.

(2) The transitional provisions and savings set out in Schedule 13 are to have effect.

(3) The enactments set out in Schedule 14 are repealed.

75 Consequential and supplementary provision

(1) The Secretary of State may by order make such incidental, consequential, transitional or supplemental provision as he thinks necessary or expedient for the general purposes, or any particular purpose, of this Act or in consequence of any of its provisions or for giving full effect to it.

(2) An order under subsection (1) may, in particular, make provision--

(a) for enabling any person by whom any powers will become exercisable, on a date specified by or under this Act, by virtue of any provision made by or under this Act to take before that date any steps which are necessary as a preliminary to the exercise of those powers;

(b) for making savings, or additional savings, from the effect of any repeal made by or under this Act.

(3) Amendments made under this section shall be in addition, and without prejudice, to those made by or under any other provision of this Act.

(4) No other provision of this Act restricts the powers conferred by this section.

76 Short title, commencement and extent

(1) This Act may be cited as the Competition Act 1998.

(2) Sections 71 and 75 and this section and paragraphs 1 to 7 and 35 of Schedule 13 come into force on the passing of this Act.

(3) The other provisions of this Act come into force on such day as the Secretary of State may by order appoint; and different days may be appointed for different purposes.

(4) This Act extends to Northern Ireland.

SCHEDULES

Sections 3(1)(a) and 19(1)(a).

SCHEDULE 1 Exclusions: Mergers and Concentrations

Part I Mergers

Enterprises ceasing to be distinct: the Chapter I prohibition

1 (1) To the extent to which an agreement (either on its own or when taken together with another agreement) results, or if carried out would result, in any two enterprises ceasing to be distinct enterprises for the purposes of Part V of the [1973 c. 41.] Fair Trading Act 1973 ("the 1973 Act"), the Chapter I prohibition does not apply to the agreement.

(2) The exclusion provided by sub-paragraph (1) extends to any provision directly related and necessary to the implementation of the merger provisions.

(3) In sub-paragraph (2) "merger provisions" means the provisions of the agreement which cause, or if carried out would cause, the agreement to have the result mentioned in sub-paragraph (1).

(4) Section 65 of the 1973 Act applies for the purposes of this paragraph as if--

(a) in subsection (3) (circumstances in which a person or group of persons may be treated as having control of an enterprise), and

(b) in subsection (4) (circumstances in which a person or group of persons may be treated as bringing an enterprise under their control),

for "may" there were substituted "must".

Enterprises ceasing to be distinct: the Chapter II prohibition

2 (1) To the extent to which conduct (either on its own or when taken together with other conduct)--

(a) results in any two enterprises ceasing to be distinct enterprises for the purposes of Part V of the 1973 Act), or

(b) is directly related and necessary to the attainment of the result mentioned in paragraph (a),

the Chapter II prohibition does not apply to that conduct.

(2) Section 65 of the 1973 Act applies for the purposes of this paragraph as it applies for the purposes of paragraph 1.

Transfer of a newspaper or of newspaper assets

3 (1) The Chapter I prohibition does not apply to an agreement to the extent to which it constitutes, or would if carried out constitute, a transfer of a newspaper or of newspaper assets for the purposes of section 57 of the 1973 Act.

(2) The Chapter II prohibition does not apply to conduct (either on its own or when taken together with other conduct) to the extent to which--

(a) it constitutes such a transfer, or

(b) it is directly related and necessary to the implementation of the transfer.

(3) The exclusion provided by sub-paragraph (1) extends to any provision directly related and necessary to the implementation of the transfer.

Withdrawal of the paragraph 1 exclusion

4 (1) The exclusion provided by paragraph 1 does not apply to a particular agreement if the Director gives a direction under this paragraph to that effect.

(2) If the Director is considering whether to give a direction under this paragraph, he may by notice in writing require any party to the agreement in question to give him such information in connection with the agreement as he may require.

(3) The Director may give a direction under this paragraph only as provided in sub-paragraph (4) or (5).

(4) If at the end of such period as may be specified in rules under section 51 a person has failed, without reasonable excuse, to comply with a requirement imposed under sub-paragraph (2), the Director may give a direction under this paragraph.

(5) The Director may also give a direction under this paragraph if--

(a) he considers--

(i) that the agreement will, if not excluded, infringe the Chapter I prohibition; and

(ii) that he is not likely to grant it an unconditional individual exemption; and

(b) the agreement is not a protected agreement.

(6) For the purposes of sub-paragraph (5), an individual exemption is unconditional if no conditions or obligations are imposed in respect of it under section 4(3)(a).

(7) A direction under this paragraph--

(a) must be in writing;

(b) may be made so as to have effect from a date specified in the direction (which may not be earlier than the date on which it is given).

Protected agreements

5 An agreement is a protected agreement for the purposes of paragraph 4 if--

(a) the Secretary of State has announced his decision not to make a merger reference to the Competition Commission under section 64 of the 1973 Act in connection with the agreement;

(b) the Secretary of State has made a merger reference to the Competition Commission under section 64 of the 1973 Act in connection with the agreement and the Commission has found that the agreement has given rise to, or would if carried out give rise to, a merger situation qualifying for investigation;

(c) the agreement does not fall within sub-paragraph (a) or (b) but has given rise to, or would if carried out give rise to, enterprises to which it relates being regarded under section 65 of the 1973 Act as ceasing to be distinct enterprises (otherwise than as the result of subsection (3) or (4)(b) of that section); or

(d) the Secretary of State has made a merger reference to the Competition Commission under section 32 of the [1991 c. 56.] Water Industry Act 1991 in connection with the agreement and the Commission has found that the agreement has given rise to, or would if carried out give rise to, a merger of the kind to which that section applies.

Part II Concentrations subject to EC controls

6 (1) To the extent to which an agreement (either on its own or when taken together with another agreement) gives rise to, or would if carried out give rise to, a concentration, the Chapter I prohibition does not apply to the agreement if the Merger Regulation gives the Commission exclusive jurisdiction in the matter.

(2) To the extent to which conduct (either on its own or when taken together with other conduct) gives rise to, or would if pursued give rise to, a concentration, the Chapter II prohibition does not apply to the conduct if the Merger Regulation gives the Commission exclusive jurisdiction in the matter.

(3) In this paragraph--

"concentration" means a concentration with a Community dimension within the meaning of Articles 1 and 3 of the Merger Regulation; and
"Merger Regulation" means Council Regulation (EEC) No. 4064/89 of 21st December 1989 on the control of concentrations between undertakings as amended by Council Regulation (EC) No. 1310/97 of 30th June 1997.

Section 3(1)(b).

SCHEDULE 2 Exclusions: Other Competition Scrutiny

Part I Financial Services

The Financial Services Act 1986 (c. 60)

1 (1) The Financial Services Act 1986 is amended as follows.

(2) For section 125 (effect of the [1976 c. 34.] Restrictive Trade Practices Act 1976), substitute--

" 125 The Competition Act 1998: Chapter I prohibition

(1) The Chapter I prohibition does not apply to an agreement for the constitution of--

(a) a recognised self-regulating organisation,

(b) a recognised investment exchange, or

to the extent to which the agreement relates to the regulating provisions of the body concerned.

(2) Subject to subsection (3) below, the Chapter I prohibition does not apply to an agreement for the constitution of--

(a) a self-regulating organisation,

(b) an investment exchange, or

to the extent to which the agreement relates to the regulating provisions of the body concerned.

(3) The exclusion provided by subsection (2) above applies only if--

(a) the body has applied for a recognition order in accordance with the provisions of this Act; and

(b) the application has not been determined.

(4) The Chapter I prohibition does not apply to a decision made by--

(a) a recognised self-regulating organisation,

(b) a recognised investment exchange, or

to the extent to which the decision relates to any of that body's regulating provisions or specified practices.

(5) The Chapter I prohibition does not apply to the specified practices of--

(a) a recognised self-regulating organisation, a recognised investment exchange or a recognised clearing house; or

(b) a person who is subject to--

(i) the rules of one of those bodies, or

(ii) the statements of principle, rules, regulations or codes of practice made by a designated agency in the exercise of functions transferred to it by a delegation order.

(6) The Chapter I prohibition does not apply to any agreement the parties to which consist of or include--

(a) a recognised self-regulating organisation, a recognised investment exchange or a recognised clearing house; or

(b) a person who is subject to--

(i) the rules of one of those bodies, or

(ii) the statements of principle, rules, regulations or codes of practice made by a designated agency in the exercise of functions transferred to it by a delegation order,

to the extent to which the agreement consists of provisions the inclusion of which is required or contemplated by any of the body's regulating provisions or specified practices or by the statements of principle, rules, regulations or codes of practice of the agency.

(7) The Chapter I prohibition does not apply to--

(a) any clearing arrangements; or

(b) any agreement between a recognised investment exchange and a recognised clearing house, to the extent to which the agreement consists of provisions the inclusion of which in the agreement is required or contemplated by any clearing arrangements.

(8) If the recognition order in respect of a body of the kind mentioned in subsection (1)(a), (b) or (c) above is revoked, subsections (1) and (4) to (7) above are to have effect as if that body had continued to be recognised until the end of the period of six months beginning with the day on which the revocation took effect.

(9) In this section--

"the Chapter I prohibition" means the prohibition imposed by section 2(1) of the Competition Act 1998;
"regulating provisions" means--
(a)
in relation to a self-regulating organisation, any rules made, or guidance issued, by the organisation;
(b)
in relation to an investment exchange, any rules made, or guidance issued, by the exchange;
(c)
in relation to a clearing house, any rules made, or guidance issued, by the clearing house;
"specified practices" means--
(a)
in the case of a recognised self-regulating organisation, the practices mentioned in section 119(2)(a)(ii) and (iii) above (read with section 119(5) and (6)(a));
(b)
in the case of a recognised investment exchange, the practices mentioned in section 119(2)(b)(ii) and (iii) above (read with section 119(5) and (6)(b));
(c)
in the case of a recognised clearing house, the practices mentioned in section 119(2)(c)(ii) and (iii) above (read with section 119(5) and (6)(b));
(d)
in the case of a person who is subject to the statements of principle, rules, regulations or codes of practice issued or made by a designated agency in the exercise of functions transferred to it by a delegation order, the practices mentioned in section 121(2)(c) above (read with section 121(4));

and expressions used in this section which are also used in Part I of the Competition Act 1998 are to be interpreted in the same way as for the purposes of that Part of that Act. "

(3) Omit section 126 (certain practices not to constitute anti-competitive practices for the purposes of the [1980 c. 21.] Competition Act 1980).

(4) For section 127 (modification of statutory provisions in relation to recognised professional bodies), substitute--

" 127 Application of Competition Act 1998 in relation to recognised professional bodies: Chapter I prohibition

(1) This section applies to--

(a) any agreement for the constitution of a recognised professional body to the extent to which it relates to the rules or guidance of that body relating to the carrying on of investment business by persons certified by it ("investment business rules"); and

(b) any other agreement, the parties to which consist of or include--

(i) a recognised professional body,

(ii) a person certified by such a body, or

(iii) a member of such a body,

and which contains a provision required or contemplated by that body's investment business rules.

(2) If it appears to the Treasury, in relation to some or all of the provisions of an agreement to which this section applies--

(a) that the provisions in question do not have, and are not intended or likely to have, to any significant extent the effect of restricting, distorting or preventing competition; or

(b) that the effect of restricting, distorting or preventing competition which the provisions in question do have, or are intended or are likely to have, is not greater than is necessary for the protection of investors,

the Treasury may make a declaration to that effect.

(3) If the Treasury make a declaration under this section, the Chapter I prohibition does not apply to the agreement to the extent to which the agreement consists of provisions to which the declaration relates.

(4) If the Treasury are satisfied that there has been a material change of circumstances, they may--

(a) revoke a declaration made under this section, if they consider that the grounds on which it was made no longer exist;

(b) vary such a declaration, if they consider that there are grounds for making a different declaration; or

(5) If the Treasury make, vary or revoke a declaration under this section they must notify the Director of their decision.

(6) If the Director proposes to exercise any Chapter III powers in respect of any provisions of an agreement to which this section applies, he must--

(a) notify the Treasury of his intention to do so; and

(b) give the Treasury particulars of the agreement and such other information--

(i) as he considers will assist the Treasury to decide whether to exercise their powers under this section; or

(ii) as the Treasury may request.

(7) The Director may not exercise his Chapter III powers in respect of any provisions of an agreement to which this section applies, unless the Treasury--

(a) have notified him that they have not made a declaration in respect of those provisions under this section and that they do not intend to make such a declaration; or

(b) have revoked a declaration under this section and a period of six months beginning with the date on which the revocation took effect has expired.

(8) A declaration under this section ceases to have effect if the agreement to which it relates ceases to be one to which this section applies.

(9) In this section--

"the Chapter I prohibition" means the prohibition imposed by section 2(1) of the Competition Act 1998,
"Chapter III powers" means the powers given to the Director by Chapter III of Part I of that Act so far as they relate to the Chapter I prohibition, and

expressions used in this section which are also used in Part I of the Competition Act 1998 are to be interpreted in the same way as for the purposes of that Part of that Act.

(10) In this section references to an agreement are to be read as applying equally to, or in relation to, a decision or concerted practice.

(11) In the application of this section to decisions and concerted practices, references to provisions of an agreement are to be read as references to elements of a decision or concerted practice. "

Part II Companies

The Companies Act 1989 (c. 40)

2 (1) The Companies Act 1989 is amended as follows.

(2) In Schedule 14, for paragraph 9 (exclusion of certain agreements from the [1976 c. 34.] Restrictive Trade Practices Act 1976), substitute--

" The Competition Act 1998

9 (1) The Chapter I prohibition does not apply to an agreement for the constitution of a recognised supervisory or qualifying body to the extent to which it relates to--

(a) rules of, or guidance issued by, the body; and

(b) incidental matters connected with the rules or guidance.

(2) The Chapter I prohibition does not apply to an agreement the parties to which consist of or include--

(a) a recognised supervisory or qualifying body, or

(b) any person mentioned in paragraph 3(5) or (6) above,

to the extent to which the agreement consists of provisions the inclusion of which in the agreement is required or contemplated by the rules or guidance of that body.

(3) The Chapter I prohibition does not apply to the practices mentioned in paragraph 3(4)(a) and (b) above.

(4) Where a recognition order is revoked, sub-paragraphs (1) to (3) above are to continue to apply for a period of six months beginning with the day on which the revocation takes effect, as if the order were still in force.

(5) In this paragraph--

(a) "the Chapter I prohibition" means the prohibition imposed by section 2(1) of the Competition Act 1998,

(b) references to an agreement are to be read as applying equally to, or in relation to, a decision or concerted practice,

and expressions used in this paragraph which are also used in Part I of the Competition Act 1998 are to be interpreted in the same way as for the purposes of that Part of that Act.

(6) In the application of this paragraph to decisions and concerted practices, references to provisions of an agreement are to be read as references to elements of a decision or concerted practice. "

The Companies (Northern Ireland) Order 1990 (S.I. 1990/593 (N.I. 5))

3 (1) The Companies (Northern Ireland) Order 1990 is amended as follows.

(2) In Schedule 14, for paragraph 9 (exclusion of certain agreements from the Restrictive Trade Practices Act 1976), substitute--

" The Competition Act 1998

9 (1) The Chapter I prohibition does not apply to an agreement for the constitution of a recognised supervisory or qualifying body to the extent to which it relates to--

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