Competition Act 1998
The Competition Act 1998 came into force on the 1 March 2000. It introduces two main prohibitions:
Chapter I: a prohibition of anti-competitive agreements, based closely on Article 81 of the EC treaty; and
Chapter II: a prohibition of abuse of a dominant position in a market, based closely on Article 82 of the EC Treaty.
Key aspects of the new legislation are:
• anti-competitive agreements, cartels and abuses of a dominant position are now unlawful from the outset;
• businesses which infringe the prohibitions are liable to financial penalties of up to 10% of UK turnover for up to 3 years ;
• competitors and customers are entitled to seek damages;
• the Director General of Fair Trading has new powers to step in at the outset to stop anti-competitive behaviour;
• investigators are able to launch 'dawn raids', and to enter premises with reasonable force; and
• the new leniency policy will make it easier for cartels to be exposed.
The intention is to create a regulatory framework that is tough on those who seek to impair competition but allows those who do compete fairly the opportunity to thrive.