Last week, the newly-established UK Competition and Markets Authority (“CMA”), its main anti-trust and consumer protection agency, announced an advisory process to provide guidance to businesses on the application of competition law to potential horizontal and vertical agreements raising novel or unresolved issues has been put into practice.
The “Short-form Opinion” (“SfO”) tool has been launched on a trial basis and follows the UK Office of Fair Trade’s 2010 trial SfO process. But the CMA’s SfO has extended the scope of the process to cover not only horizontal but also vertical agreements.
The process is based on the principle that businesses should self-assess the compliance of their agreements with competition law, rather than notify them for clearance or exemption by competition authorities.
Parties should formulate a reasoned request providing details of the future agreement to the CMA. Parties should also state why the criteria to issue a SfO are met and the novel and unresolved questions on which guidance is sought.
This way, UK regulators can save time on “novel or unresolved” questions when the issue is identical or similar to questions raised in cases pending before a Court of the European Union (ECJ), the European Commission (EC) or national competition authorities.
Once submitted, the CMA staff will review the information and will issue a SfO within the envisaged timeframe of two to three months from receipt of the request. A non-confidential version of each issued SfO will be published on the CMA’s webpage.
The UK regulator will cooperate in this stage with sector regulators when an application for a SfO relates to a regulated sector.
A SfO is a non-binding opinion and cannot prejudge the assessment of the same question by EC, ECJ, the Competition Appeal Tribunal or any UK court.