| Unfair competition? • The law • Enforcement • How we can help • How to complain |
Unfair competition: enforcement can be tricky
Unfair competition is a Reckon guide to complaining about anti-competitive conduct or regulations. This section highlights the strengths and limitations of the UK system of enforcement of the legal provisions.
The law provides means of redress
The Office of Fair Trading (OFT) and some sector regulators oversee the competition rules. Complaining to the OFT is free. If an infringement decision is made, a claim for damages can be made in the Competition Appeal Tribunal. The Tribunal also hears appeals against decisions of the OFT and the sector regulators. The Tribunal publishes a helpful guide to proceedings (73 pages, PDF).
Competition law can be enforced through actions for damages or applications for interim relief in the courts of England and Wales, Scotland or Northern Ireland. It can also be invoked as a defence in legal proceedings.
But there are still some shortcomings
Despite these structures, getting effective redress for unfair competition can be difficult in the UK. The regulators have been slow and ineffective at pursuing abuse cases, as was noted by the National Audit Office in the case of the OFT.
In 2004-2005, the OFT opened 1,173 complaint cases but only 17 formal investigations. Source: OFT annual report 2004-2005, page 46: see "Objective 3" section (10 pages, PDF).
The OFT focuses its resources on mergers and on conduct thought most detrimental to consumers. Many abuses have little visible direct effect on consumers, and these cases have received inadequate attention. On 6 July 2005 the Tribunal found that the OFT had been wrong to overlook abuse in a case involving funeral directors' access to a crematorium, and reminded it that the law prohibits abuse whether it directly prejudices consumers or not. (See Burgess for more information.)
The sector regulators are also impaired by conflicting claims on their resources. Whilst normal statutory duties do not apply in competition cases, it is still difficult for them to disregard their other policies entirely. Environmental and funding pressures, and the need to encourage monopolies to achieve efficiency improvements in the short term, may impair the protection of individual businesses and of innovative ways of competing.
Going to court can be faster and more effective, but is also more expensive, time-consuming and risky.
What this means for complainants
In order to make effective use of current enforcement mechanisms, a complaint must be focused on valid competition law issues, pre-empt counter-arguments, and provide a clear scope for the investigation. It should provide the terms of reference for an investigation and prevent drift or abandonment.
For more information
For an initial discussion of a case or to ask Reckon LLP to handle a complaint, please contact Franck Latrémolière (020 7841 5858) or Nicholas Francis (020 7841 5859), or e-mail f.latremoliere@reckon.co.uk.
This guide provides general information only. It is not a full substitute for professional or legal advice tailored to your circumstances.
