OFT and CC agree working practice for reviewing undertakings and orders

15/09 17 February 2009

The OFT and the Competition Commission (CC) have agreed a Memorandum of Understanding to promote greater clarity on their process for reviewing merger, monopoly and market undertakings and orders.

Under the Enterprise Act, undertakings can be accepted and orders imposed by the CC following the referral of a merger, or a market investigation reference, by the OFT. The OFT has a statutory duty to keep these undertakings and orders (and undertakings and orders under the previous Fair Trading Act mergers and monopolies regime) under review, recommending to the CC, if necessary, that they should be varied or terminated. The final responsibility for deciding on a variation or termination of undertakings or orders then lies with the CC in all but a very limited number of cases.

The aim of the Memorandum is to:

promote continued effective co-operation between the OFT and the CC in the variation and termination of undertakings and orders, by establishing a clearer framework for the processes to be followed, and
ensure that the process for the variation and termination of undertakings and orders is clear to stakeholders.

Download the Memorandum of Understanding (pdf 110 kb).

NOTES

1. The Statutory roles of the OFT and the CC are set out in the Enterprise Act and the Fair Trading Act. The MoU aims to define more closely the practical aspects of the working relationship between the two bodies.

2. The OFT's responsibility for considering and advising the CC in deciding on variation or termination of undertakings or orders is outlined under in sections 92(2) and (3) and 162(2) and (3) of the Enterprise Act; sections 88(4) and (5) of the Fair Trading Act (as preserved in schedule 24 of the Enterprise Act). The CC's responsibility for deciding on variation or termination of undertakings or orders is outlined in sections 82(2) and (5), 84(3) and (4), 159 (4), (5) and (6) and 160(5) and (6); section 56 of the Fair Trading Act (as preserved in schedule 24 of the Enterprise Act).

3. The MoU does not relate to the small number of cases in which the OFT provides advice to the Secretary of State rather than the CC. These are generally cases which raise public interest issues.

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