The UK will no longer be a part of the EU competition system from 31 December 2020 (at the end of the transition period). The key impacts of this on competition and merger control are that:
- The UK, Competition and Markets Authority (CMA) and sector regulators will no longer be empowered to investigate and enforce infringements of EU law as well as UK competition law and to apply Articles 101 and 102 of the Treaty on the Functioning of the European Union (TFEU) in parallel with UK law.
- The one-stop shop provided by the EU Merger Regulation will no longer apply such that the CMA will no longer be prohibited from investigating mergers with an EU dimension under the EU Merger Regulation. Mergers could be subject to parallel review in both the UK and Brussels.
On 2 December 2020, the CMA published its final guidance on its functions after the transition period. The final guidance is largely the same as the draft guidance published in October summarised here.
The Government also published the draft Competition (Amendment etc) (EU Exit) Regulations 2020 which confirm (i) the transitional provisions in relation to cases initiated by the European Commission during the transition period, and which confirms that the European Commission will continue to have competence and the CMA will continue to assist the European Commission; and (ii) the transfer of the monitoring and enforcement of remedies (commitments and enforcement decisions) imposed the European Commission to the UK competition authorities.
The EU also published a Brexit stakeholder notice on 02 December 2020 which confirms:
- EU antitrust rules will continue to apply to UK companies, even after the end of the transition period, if its conduct is implemented or produces effects within the EU internal market (UK competition law may also apply in parallel).
- The European Commission will no longer be able to carry out Dawn Raids in the UK (with the exception of the inspections carried out in the context of proceedings initiated before the end of the transition period (i.e., before 31 December 2020).
- The European Commission will remain competent for competition proceedings that have been "initiated" before the end of the transition period.
- The EU merger control system continues to apply to and in the UK during the transition period. After the end of the transition period, both EU and UK merger control could apply to mergers and merging parties will no longer benefit from the one-stop-shop principle.
Whether or not there is a final Brexit deal between the UK and EU, there are important implications for businesses operating in and trading with the UK. Further details are provided on our Brexit In Focus page.