Posts tagged ‘competition’

Cameron acknowledges need to address competition law issues at BITC AGM

December 3rd, 2010
The Prime Minister David Cameron said at yesterday’s BITC AGM and Leadership Summit: “I get the message loud and clear, and we will do everything we can to tackle those barriers head on – whether it is the red tape you face …whether it is being able to collaborate as businesses without having the competition authorities throwing you in jail. I understand the barriers. We are going to work with you to get rid of them.”

This was in response to the business challenge presented by Sir Stuart Rose off the back of BITC’s latest member research (pg 6):
Competition law
A perceived barrier to greater business collaboration is where business feel it could be deemed anti-competitive to come together to discuss some of the core sector wide issues, even when this could have a powerful social or environmental impact.

Often there is felt to be insufficient commercial advantage for one organisation to take the lead. Business leaders suggest creating neutral cross-sector environments for companies to come together without fear of reprimand under competition law, enabling more companies to take significant steps towards greater engagement.

“70% of business leaders surveyed say it is important that government removes the red tape associated with businesses collaborating on the impacts of their core business.”

Today’s FT reports“Rules that prevent welfare claimants from taking part-time jobs or longer work placements should be eased, business leaders said, along with competition laws that prevent businesses from collaborating on sector-wide initiatives… Mr Cameron pledged to “tackle these barriers head on””

The Cooperatition Incubator welcomes new OFT Short-form opinions process

June 24th, 2010

The Cooperatition Incubator has today welcomed the UK Office of Fair Trading’s (OFT) announcement that it is establishing a ‘Short-form Opinions’ process.  The first Short-form opinion was issued (27 April 2010) on questions raised by Makro Self-Service Wholesalers Limited and Palmer & Harvey McLane Limited in relation to their proposed joint purchasing co-operation agreement.

In March 2010 Philip Collin, Chairman of the UK Office of Fair Trading announced that the OFT will offer ‘Short-form Opinions’ (SFO). Introducing the new process the OFT acknowledged:

“Concerns have been expressed that uncertainty about how competition law in particular might be applied has led to some forms of potentially beneficial collaborative work between businesses not going ahead. In some cases, it may not be clear how the competition rules may be applied to collaborative conduct, for example with regard to some government-led initiatives.

“As a result, we are proposing to trial a ‘short-form’ opinion procedure. This would allow us, in a limited number of cases, to provide prompt guidance where there is a novel or unresolved issue of wider interest arising in the context of a specific prospective collaborative initiative. We would like to hear from you and your members about issues that you or they think would benefit from clarification through means of such a ‘short-form’ opinion.”

In April 2010 – when they published their first SFO – the UK Office of Fair Trading added:

“Under the Short-form Opinion process the OFT aims to provide guidance, within a prompt timetable, to businesses seeking clarity on how the law applies to prospective collaboration agreements between competitors which raise novel or unresolved competition issues….

“During its analysis, the OFT identified a concern that certain exchanges of information between the firms could potentially lead to a reduction in competition. However following OFT advice, the parties have agreed to ensure the data they supply to each other is general and aggregated, preventing either company from extrapolating specific or sensitive information.

“The new process is being trialled in response to feedback from business that some potentially beneficial collaboration between companies is not proceeding due to concerns about infringing competition law, which carries civil and in some circumstances criminal sanctions.”

Andrew Dakers commented:

“The OFT’s Short-form Opinions process represents a significant step towards addressing the concerns that we have been raising over the past few years that companies are not engaging in collaborative agreements that would deliver public benefit, due to competition law risks.  This new process will help companies mitigate the risks and is a key milestone in our push for a co-regulating, responsible economy.”

“The OFT and Department for Business, Innovation and Skills (BIS) must now set out how the benefits of this change can be independently assessed; how the new process can be communicated across the business community; the extent to which it will enable voluntary horizontal agreements that pass price increases onto the consumer, whilst delivering social/ environmental benefits; and whether there is the necessary capacity in the OFT for resource constraints to not be a barrier to the issuing Short-form opinions.”

Details of the OFT’s new approach can be found here:

Cement sector cooperation managing competition law constraints

September 11th, 2009

An interview on FT.com (11 Sept 09) with Bruno Lafont, Chief Executive of Lafarge, the French building materials group, highlights what is being achieved by cooperation within the cement production sector.

Asked about the Copenhagen Summit he said: “It is very important that the world together understands what the challenges are. And we should aim to eliminate the risks created by climate change, which are very serious for our children and for the children of our children. There is a need for strong cooperation but [also] an agreement on the goal and how to share the pain, because there will be a cost.”

“Business first should understand the goal and take its share of the goal. For example, the cement business, which has a strong ecological footprint, has taken some actions. We have created cement sustainable initiatives where 30 cement groups are working together at fixing goals, committing to actions, CO2 reductions, improvements in their governance and on their ecological footprint. So that means the sector has started to regulate itself.”

For more information on the Cement Sustainability Initiative visit http://www.wbcsdcement.org/

Significantly the initiative has carefully managed competition law issues:
“Request GNR system data… The PMC will review all requests to determine, first, if the data is available, and second, if responses to the query would fall within the limits of confidentiality and anti-trust constraints adopted for this system.”
Source: http://www.wbcsdcement.org/index.php?option=com_content&task=view&id=66&Itemid=133

“Data Confidentiality …PricewaterhouseCoopers also provides a guarantee of non-disclosure of confidential information and compliance with competition law.”
Source: http://www.wbcsdcement.org/index.php?option=com_content&task=view&id=65&Itemid=132

New Delhi conference to explore non-efficiency factors in competition law

August 25th, 2009

New_DelhiCompetition law is now in place in around 108 countries  including emerging economies like China, Thailand, Korea, Malaysia, Singapore and Vietnam where stringent competitive regulation is considered to be a constructive step to the development of market economy.

The forthcoming International Conference on Competition Law (6-7 November 2009, New Delhi) organised by the World Council on Corporate Governance in association with India’s International Academy of Law aims to examine the status of competition law in various jurisdictions with particular reference to India and the emerging economies where it is being increasingly viewed as an instrument for inclusive growth.

India has been selected as the venue of the conference as it has got a new competition law – Competition Act 2002 as amended in 2007. It has also established the Competition Commission of India with effect from October 2003 and has commenced enforcement of the law with effect from 20 May 2009.  As a consequence, Indian companies are keen to understand the role of the competition lawand its impact on their day-to-day operations.

The conference aims to share information and practice on competition law in various jurisdictions and provide a learning experience for the Indian and foreign companies, law firms, regulatory and judicial authorities and other stakeholders. It also aims to provide a blueprint on how competition law and policy can be evolved to become a powerful tool for fair and competitive markets that, in turn, promote inclusive growth.  

Justice P N Bhagwati, Chairman, International Academy of Law, commented:

“One of the primary aims of competition is to diffuse socioeconomic power of the incumbents and broaden the economic and social base by encouraging participation of new entrants and thus, fostering innovation and growth.

“It improves consumer welfare by stirring up inter-firm rivalry that compels each firm to excel to satisfy the customer by offering better deals and newer products with superior quality at lower prices.”

Andrew Dakers, Founder, The Cooperatition Incubator, added:

“We are really excited that the organisers have decided to include discussion on the social objectives of competition law and non-efficiency objectives in competition law on the agenda.  This makes the New Delhi conference an important milestone in the discussion of competition law and its relationship with responsible practices in individual businesses, across sectors and supply chains.”

Full programme: http://www.wcfcg.net/ICCL_NewDelhi.pdf
Speaker submission guidelines: http://www.wcfcg.net/Papersubmissionguidelines.pdf

Morrison and Tesco fight OFT findings

July 23rd, 2009

Source: FT.com

Tesco, Britain’s biggest retailer, and smaller rival Wm Morrison insisted on Thursday they would not give up their fight against allegations that they fixed the price of milk.

The Office of Fair Trading said that only Tesco and Morrison were continuing to contest the provisional findings of its investigation into alleged price fixing in the UK dairy market, which accused a number of dairies and supermarkets of colluding to raise prices artificially in 2002 and 2003.

Other parties investigated by the OFT, including Asda, The Cheese Company, Dairy Crest, J Sainsbury and Robert Wiseman Dairies, have all settled with the OFT. Arla Foods is being spared a fine for its role after co-operating with the OFT.

The OFT sent out further evidence on Thursday that its claims support its findings of alleged collusion to all the parties involved in the investigation.

“At this stage it should not be assumed that the law has been broken,” the competition watchdog said, adding that it would “carefully consider any representations, and the evidence as a whole, before reaching any final conclusion.”

Tesco said it would continue to mount a strong defence against the OFT’s allegations.

“We have made it clear that we did not collude with anyone and that remains the position,” said Lucy Neville-Rolfe, director of corporate and legal affairs at Tesco.

She said Tesco did not believe that the nature of communications with suppliers, at the heart of the investigation, went beyond permissible discussions under competition law.

She added: “We will of course look carefully at any new evidence the OFT sends to us relating to events that took place in 2002 and 2003. We will, however, continue to defend our position strongly.”

Morrison will also continue to contest the allegations.

It said in its own statement: “We wait to read the document in detail; however, our initial view is that nothing has changed since the original statement issued two years ago.

“It remains our firm belief that there are no reasonable grounds for the OFT’s allegations against us and no evidence to suggest our involvement, therefore we are continuing to contest the provisional findings and make strong representations that Morrisons should not be part of this inquiry.”

It is continuing to fight as it does not believe it was involved in fixing prices, and does not see that there is compelling evidence to suggest that it was.

It has also only been accused in one of the particular instances of alleged price fixing.

The OFT said Tesco and Morrison would now have an opportunity to make written and oral representations in response to the additional evidence.