Prevention, restriction or distortion of competition meaning

A key proposition underpinning UK competition law Rival undertakings are expected to pursue their strategies independently in the marketplace. In general, head-to-head rivalry should deliver maximum consumer benefit and allocate resources most efficiently. As a result, the Competition and Markets Authority (CMA) treats with caution any arrangement liable to soften competition or lessen the commercial uncertainty that would otherwise separate competitors. Nonetheless, businesses may have sound reasons for entering agreements whose clauses or obligations risk constraining competition. That is particularly true where such arrangements are intended to create or advance beneficial outcomes (efficiencies) that would not materialise without the restriction included in the agreement. UK competition policy aims to balance safeguarding effective competition (notably by outlawing illegitimate collusion) against securing advantages that arise-and are often only attainable-through co-operation. Chapter I sets out the legal framework for this balanced appraisal, weighing the restrictive features introduced by co-ordination alongside any pro-competitive efficiencies an agreement brings-benefits that may, in turn, offset identified appreciable restrictive effects. Although the focus of this Practice Note...

Vertical agreements Under section 2(1) of the Competition Act 1998 (CA 98), vertical agreements are banned. The Digital Markets, Competition and Consumers Act 2024 (DMCC Act) has revised the language in section 2 so that, in specified situations, it captures arrangements carried out beyond the UK. The prohibition covers agreements between undertakings, concerted practices, and decisions of associations of undertakings that have as their object or effect the prevention, restriction or distortion of competition within the UK, or any part of it, and which may influence trade in the UK or a part of it where such agreements, decisions or practices are implemented, or intended to be implemented, in the UK. In all other instances, the ban extends to conduct likely to have an immediate, substantial and foreseeable impact on trade within the UK or a part of the UK. In addition, section 2(3) CA 98 requires that an agreement is implemented, or intended to be implemented, in the UK. As indicated above, the DMCC Act adjusts the scope...

Information exchange Information exchange is a routine commercial behaviour that can boost transparency around prices and other commercially sensitive data and, in some cases, deliver efficiencies. Yet it is under growing scrutiny as a potential anti-competitive tactic. At the same time, information exchange remains one of the most difficult areas for the application of competition law. Examples of relevant conduct include: alleged price signalling sharing of information and bid-rigging arrangements unilateral disclosure of intended future pricing indirect exchanges of competitively sensitive information information exchange via or through an intermediary information exchange in initial public offerings and share placings information exchange between merging parties themselves This Practice Note examines the application by the European Commission (Commission) of Article 101 TFEU to agreements and concerted practices involving the exchange of information. For a UK competition perspective, see Information exchange under UK competition law. On 1 June 2023, the Commission adopted new Guidelines on the applicability of Article 101...