CMA tasked with reporting on state of competition

Out-Law News | 07 Feb 2020 | 9:54 am | 1 min. read

The UK's Competition and Markets Authority (CMA) is to produce regular 'state of competition' reports in a global first for competition regulators.

The CMA has been tasked with producing the reports by the UK government, which said the reports should inform policy making and regulatory intervention in UK markets.

Alan Davis, competition specialist at Pinsent Masons, the law firm behind Out-Law, said: "This a daunting task given its scale and the novelty of this approach, but it is likely to provide greater focus for the CMA in its work and how it prioritises the use of its resources in future years. The government’s entrustment of this work to the CMA also appears to indicate its support for an active and interventionist competition policy in the UK post-Brexit."

The first 'state of competition' report from the CMA is to be published this summer. The precise regularity of the reports thereafter has still to be determined.

In a jointly signed letter sent to CMA chief executive Andrea Coscelli, UK chancellor Sajid Javid and business secretary Andrea Leadsom said: "This work will provide the CMA, government and the public with valuable evidence to inform whether and where any additional action on the part of the CMA or government may be required to boost competition across UK markets."

"The ambition is that these reports will also provide both the CMA and government with information to better target our respective resources and tools towards raising competition in particular sectors or national, regional or local markets that may be found to be of potential concern," the ministers said.

Javid and Leadsom said the regular reports are needed as current understanding of how well competition is working in the UK is "limited".

"While the CMA collects valuable information on competition in particular markets through its markets work, merger control regime and antitrust enforcement activities, unlike other key drivers of economic success, such as GDP growth or the employment rate, there is no agreed way to measure and monitor the state of competition across the whole economy," their letter said.

"An expert analysis of the state of UK competition is needed to fill this gap and enable government to determine on an ongoing basis what, if any, additional action is needed to promote competition across the UK economy," they said.

The publication of regular 'state of competition' reports will be a global first for competition regulators, according to the ministers.

"We are confident that as a world-leading competition authority publishing influential and innovative research, the CMA has the expertise to lead this agenda, working with the academic community, the Office for National Statistics and others, and that substantial progress can be made in understanding the state of competition across the economy," said Javid and Leadsom.