the first year of the cma andrea coscelli executive director, markets and mergers in-house counsel...
TRANSCRIPT
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The First Year of the CMA
Andrea CoscelliExecutive Director, Markets and Mergers
In-house Counsel Association Meeting26th February 2015
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Organisational Structure
Andrea Coscelli,Executive Director,
Markets and Mergers
Sonya BranchExecutive Director,
Enforcement
Sector Regulation
Unit
Mergers Phase I
Cartels & Criminal Group
Competition, Consumer and Markets Group (CCMG)Market Studies
Market InvestigationsPhase II Mergers
CA98 CasesConsumer Cases
Regulatory Appeals
Alex ChisholmCMA Chief Executive
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Current Mergers
● Main Phase I Mergers:
- East Coast Mainline (rail)
- 99p/Poundland
- Green King/Spirit (pubs)
- Ashford/St Peter’s (hospitals)
- BT/EE
- Dairy Crest/Muller (dairy)
● Phase II Mergers:
- Pork Farms/Kerry CSP Assets (Pork Pies)
- Reckitt Benckiser/KY (Lubricants)
- Xchanging/Agencyport (Software)
- Sonoco/Weidenhammer (Packaging)
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Financial year 04/05 05/06 06/07 07/08 08/09 09/10 10/11 11/12 12/13 13/14 14/20 Feb 2015
Referred 18 17 13 10 8 7 8 9 14 8 6UIL accepted 5 6 7 5 6 5 4 5 10 0 4
Unconditional clearances - 'de minimis' exception
1030
1180
860
783
534
437
434
623
494
423
496
Found not to qualify
45 69 22 15 9 10 14 21 23 12 10
Total decisions 171 210 128 111 80 72 73 100 100 65 75
Cases to CRM 35 36 30 22 29 22 21 30 32 19 21
IU – IEO 6 10 10 10 11 10 9 25 23 26 29
Phase 1 statistics
Name Sector Date of decision Date referred
Diageo/United Spirits Food manufacturing 25 November 2013 UILs accepted 31 October 2014
Pure Gym/The Gym Recreation and Leisure
26 June 2014 26 June 2014 – merger abandoned
Xchanging/Agencyport
Electronics/software
2 December 2014 8 December 2014
Pork farms/Kerry Foods
Food manufacturing 17 December 2014 5 January 2015
Reckitt Benckiser/K-Y Brand
Healthcare 19 December 2014 7 January 2015
Motor Fuel/Murco Petrol Stations 22 December 2014 UILs accepted 16 February 2015
Sonoco/Weidenhammer
Packaging 13 January 2015 27 January 2015
Immediate Media/ Future Publishing
Magazines 31 October 2014 UILs accepted 6 January 2015
East Coast Rail franchises 6 February 2015 UILs accepted 20 February 2015
Ashford St Peter's/Royal Surrey
Healthcare and medical equipment
18 February 2015 Provisional decision to refer
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SLC decisions (2014/15)
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● We are committed to monitoring all industry sectors● Our Mergers Intelligence Committee (MIC) has undertaken
a systematic review of transactions (over 500 since 1 April)● 18 of 75 decisions since 1 April were a result of the MIC● Nine of these went to CRM and two were referred –
Xchanging/Agencyport and Sonoco/Weidenhammer● The number of MIC decisions found not to qualify (‘FNTQ’)
remains low, with only three since 1 April 2014 (compared to 5 in 2013/14, 14 in 2012/13 and 15 in 2011/12).
Merger enforcement
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Market Investigations
Project Start - Anticipated End Date
Current Stage
Payday Lending June 2013 - June 2015
Published Final Report: February 2015
Energy June 2014 -December 2015
Publication of updated issues statement and working papers: February 2015
Banking November 2014 - May 2016
Publication of working papers and annotated issues statement: March to June 2015
Private Healthcare Remittal
January 2015 - Remittal initiated
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CFIs/Market Studies/Policy Projects/Reg Appeals
Project Instrument Start - Anticipated End Date
Current Stage
Online Reviews and Endorsements
Call for Information and Consumer Enforcement (CPRs)
February 2015 – June 2015
Launch CFI: 26 February 2015
Consumer Data Call For Information
January 2015 – May 2015
Survey ongoing: Feb – March 2015
Rail Services Policy Project January 2015 – October 2015
Bristol Waters v Ofwat
Regulatory Appeal
March 2015 - Appeal by Bristol Waters in relation to Ofwat’s Price Determination
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CA98 Cases OverviewProject Start -
Anticipated End Date
Current Stage
Pay for Delay August 2011 – June 2015
Supplementary Statement of Objections was issued October 2014. CMA to consider parties’ written and oral representations before taking any decision as to whether competition law has in fact been infringed.
Project Stock June 2014 – May 2015
Evidence gathering and work towards Stop/Go in March/April 2015.
Commercial Catering
August 2014 – June 2015
Evidence gathering and carrying out further investigatory steps such as analysis, information requests and stakeholder meetings. Working towards another Stop/Go decision in June 2015
Bathroom Fittings
August 2014 – June 2015
Gathering evidence and earlier this month we took a decision to continue with the case. Over the coming months, we will be engaging in further investigation, including analysis and potential further information requests and stakeholder meetings.
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Project Start - Anticipated End Date
Current Stage
Conduct in the healthcare sector
July 2014 – April 2015
Further evidence gathering analysis and review
Property sales and lettings investigation
December 2013 – June 2015
Opportunity for parties to make written and oral representations on the matters contained in the statement of objections
Supply of galvanised steel tanks for water storage
January 2015 Continuing the investigation into suspected cartel conduct in respect of the supply of galvanised steel tanks for water storage
Supply of pharmaceutical products
May 2013 The CMA has not reached a view as to whether there is sufficient evidence of an infringement of competition law for it to issue a Statement of Objections. If the CMA does issue a Statement of Objections, it will provide an opportunity for written and oral representations.
CA98 Cases Overview
Compliance – a CMA priority
“The more we can promote awareness of competition and consumer law and a culture of compliance amongst firms, the more we can demonstrate that those firms who do not comply merit serious punishments.”
Alex Chisholm, CMA Chief Executive
• The CMA recognises that most businesses wish to comply with competition law… …and is keen to help such businesses to do so
• When compliance is the norm it enables greater enforcement targeting• Compliance and deterrence are complementary• Compliance generates intelligence about others’ anti-competitive behaviours
Why is compliance a priority?
A virtuous circle
Compliance – our approach
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1. Pushing compliance up the corporate agenda: reaching boards via partners
• Organisations representing businesses
• Professional representative bodies
2. Taking lessons learned, from cases and markets work, to change business behaviour
• Mercedes cartel case – taking lessons learned to the franchised motor dealer sector
3. Strengthening tools & techniques to communicate our messages effectively
• Targeted, accessible, relevant information (e.g. case studies, 60 second summaries, open letters)
4. Using research to target companies and activity for greater impact
• SME’s, specific anti-competitive behaviours (e.g. bid-rigging, unlawful sharing of market information)
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Strategic Assessment
● Factors that may inhibit consumers’ ability to access markets, or derive the benefits that should be available to them in doing so, and issues that may affect consumers’ decision-making
● Online markets and the digital economy
● Emerging sectors and business models, and in particular the effects of technological development
● Regulated sectors and infrastructure markets
● Markets for public services
● Markets with significant potential to affect overall economic growth