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The OFT yesterday set out new decision-making processes and procedural enhancements to boost the speed and robustness of Competition Act 1998 (CA98) investigations and increase engagement with parties involved.

The updated guidance on CA98 procedures follows a consultation process launched in March 2012. It updates the OFT's guidance originally published in March 2011, including by providing for:

• Collective decision-making, with final decisions on infringement and penalty to be taken by a three person 'case decision group'.
• In cases where the OFT is considering finding an infringement and imposing a financial penalty, the ability for parties to make representations on key elements of the OFT's proposed penalty calculation, after they have made representations on matters of substance, but ahead of the final decision being taken.
• More interactive oral hearings, to provide greater opportunity for direct dialogue between parties to an investigation and the decision-makers on the case, as well as additional 'state of play' meetings.
• Publishing case opening notices and case-specific administrative timetables on the OFT's website to improve transparency of ongoing CA98 investigations.

As part of the follow up from its March consultation, the OFT is also extending the trial of its Procedural Adjudicator role until the OFT's CA98 enforcement powers transfer to the Competition and Markets Authority (CMA) in April 2014. It believes that its trial of a Procedural Adjudicator role, which started in March 2011, has been a success to date, resolving disputes in relation to certain procedural issues in a swift, efficient and cost-effective manner.

Jackie Holland, OFT Senior Director of Policy, said:

'Our updated Competition Act procedural guidance reflects the lessons we have learnt from past cases, external feedback and international best practice. We believe these changes will enhance the robustness and efficiency of our Competition Act cases, as well as resulting in better interaction with parties to investigations and improving the transparency of our work.'

Download the new guidance (pdf 872kb).

See the OFT's all-cases page.

NOTES

1. On 28 March 2012 the OFT published for consultation a revised draft of its guidance on the OFT's investigation procedures in competition cases, which was first published on 2 March 2011 (OFT1263). The OFT has also published a summary of the consultation responses and a synopsis of a discussion event held on 2 May 2012.
2. The OFT is empowered to apply and enforce the Chapter I and Chapter II prohibitions of the CA98, which prohibit agreements preventing, restricting or distorting competition in the UK as well as certain anti-competitive conduct by undertakings holding a dominant position. The OFT also has powers to apply and enforce Articles 101 and 102 of the Treaty on the Functioning of the European Union, which are similar to the Chapter I and II prohibitions, but which apply to agreements or conduct which may affect trade between Member States of the European Union.
3. As part of the new decision-making model, the OFT Board has established a Policy Committee, composed of the OFT's Chief Executive, other executive members of the OFT Board, the Chief Economist, the General Counsel and the Senior Director, Policy Group and other senior members of staff. This Policy Committee was referred to as the CA98 'Decisions Committee' in the OFT's consultation document.
4. If the OFT issues a Statement of Objections in a case, the Policy Committee appoints a group of three decision-makers to take the final decision on infringement and penalty. That three-person Case Decision Group will not include any member of the investigation team responsible for the decision to issue a Statement of Objections.
5. The decision-making model implemented today differs in certain respects from that originally consulted upon in March 2012. In particular, decisions relating to the imposition of interim measures, the acceptance of commitments, and possible settlement will continue to be taken by the Senior Responsible Officer (consulting with other OFT senior officials as appropriate). The agreement of a settlement or the acceptance of commitments by the SRO will require the approval of the Policy Committee before taking effect. The OFT's March 2012 consultation document had proposed that these decisions should be taken by the Case Decision Group. The approach now taken reflects views received during the consultation.
6. The Enterprise and Regulatory Reform Bill 2012 (the ERR Bill), which provides for the establishment of the CMA, is currently before Parliament. The CMA is expected to be empowered to apply and enforce the Chapter I and Chapter II prohibitions of the CA98 and Articles 101 and 102 of the Treaty on the Functioning of the European Union in April 2014. The ERR Bill provides for the CMA's management to determine the appropriate decision making structure for the CMA.
7. The Procedural Adjudicator's role is to resolve disputes in relation to case team decisions on certain procedural issues in a swift, efficient and cost-effective manner. Since March 2012, the Procedural Adjudicator has also been responsible for chairing oral hearings in CA98 cases and reporting on procedural issues to the relevant decision-maker(s) following the oral hearing(s) in a case. It is for the CMA's management to determine the extent to which it establishes a Procedural Adjudicator or equivalent role from the point at which the CMA has powers to apply and enforce the Chapter I and Chapter II prohibitions of the CA98 and Articles 101 and 102 of the Treaty on the Functioning of the European Union.