The Competition and Markets Authority: A New Era for U.K. Competition Law Enforcement?
Paula Riedel, Anna Mitchell, May 14, 2012
Since October 2010, it has, in essence, been a certainty that a merger between the OFT and the CC would go ahead, notwithstanding the fact that they are both relatively small, low-turnover agencies, and the obvious cost savings arising out of a merger between them are not immediately apparent. Indeed, it is estimated that the creation of a single CMA entity will only save the Government, on average, approximately £30 million (less transitional costs) over a 10-year period. Therefore, while the original impetus may have been one of cost cutting and the creation of efficiencies, the merger may in reality be seen by many as more of a philosophical change, driven by the fact that the Government believes a single body, without any internal rivalry or differing views, would be a stronger advocate for competition in the United Kingdom than the current regime.
The responses to the Government's consultation indicated that those who use the system are largely skeptical about the reforms, especially the controversial loss of the "second pair of eyes" which necessarily comes from having two reviewing authorities. Indeed, the existing U.K. competition regime is highly regarded internationally, with the CC achieving the highest rating of five stars and the OFT receiving 4.5 stars in a recent Global Competition Review rating report. In particular, the U.K. merger regime has been commended for its technical competence, independence from the political process, transparency and access to decision-makers, and accountability and robustness of decisions, making lawyers and businesses alike nervous about the loss of the current regime.