Competition Act 1998 (United Kingdom)

Cut out of the Competition Act 1998 (complete text here):

The prohibition

Agreements etc. preventing, restricting or distorting competition.

2. - (1) Subject to section 3, agreements between undertakings, decisions by associations of undertakings or concerted practices which-

(a) may affect trade within the United Kingdom, and

(b) have as their object or effect the prevention, restriction or distortion of competition within the United Kingdom,

are prohibited unless they are exempt in accordance with the provisions of this Part.

(2) Subsection (1) applies, in particular, to agreements, decisions or practices which-

(a) directly or indirectly fix purchase or selling prices or any other trading conditions;

(b) limit or control production, markets, technical development or investment;

(c) share markets or sources of supply;

(d) apply dissimilar conditions to equivalent transactions with other trading parties, thereby placing them at a competitive disadvantage;

(e) make the conclusion of contracts subject to acceptance by the other parties of supplementary obligations which, by their nature or according to commercial usage, have no connection with the subject of such contracts.

(3) Subsection (1) applies only if the agreement, decision or practice is, or is intended to be, implemented in the United Kingdom.

(4) Any agreement or decision which is prohibited by subsection (1) is void.

(5) A provision of this Part which is expressed to apply to, or in relation to, an agreement is to be read as applying equally to, or in relation to, a decision by an association of undertakings or a concerted practice (but with any necessary modifications).

(6) Subsection (5) does not apply where the context otherwise requires.

(7) In this section "the United Kingdom" means, in relation to an agreement which operates or is intended to operate only in a part of the United Kingdom, that part.

(8) The prohibition imposed by subsection (1) is referred to in this Act as "the Chapter I prohibition".
 

Excluded agreements

3. - (1) The Chapter I prohibition does not apply in any of the cases in which it is excluded by or as a result of-

(a) Schedule 1 (mergers and concentrations);

(b) Schedule 2 (competition scrutiny under other enactments);

(c) Schedule 3 (planning obligations and other general exclusions); or

(d) Schedule 4 (professional rules).

(2) The Secretary of State may at any time by order amend Schedule 1, with respect to the Chapter I prohibition, by-

(a) providing for one or more additional exclusions; or

(b) amending or removing any provision (whether or not it has been added by an order under this subsection).

(3) The Secretary of State may at any time by order amend Schedule 3, with respect to the Chapter I prohibition, by-

(a) providing for one or more additional exclusions; or

(b) amending or removing any provision-

(i) added by an order under this subsection; or

(ii) included in paragraph 1, 2, 8 or 9 of Schedule 3.

(4) The power under subsection (3) to provide for an additional exclusion may be exercised only if it appears to the Secretary of State that agreements which fall within the additional exclusion-

(a) do not in general have an adverse effect on competition, or

(b) are, in general, best considered under Chapter II or the Fair Trading Act 1973.

(5) An order under subsection (2)(a) or (3)(a) may include provision (similar to that made with respect to any other exclusion provided by the relevant Schedule) for the exclusion concerned to cease to apply to a particular agreement.

(6) Schedule 3 also gives the Secretary of State power to exclude agreements from the Chapter I prohibition in certain circumstances.
 

Individual exemptions.

4. - (1) The Director may grant an exemption from the Chapter I prohibition with respect to a particular agreement if-

(a) a request for an exemption has been made to him under section 14 by a party to the agreement; and

(b) the agreement is one to which section 9 applies.

(2) An exemption granted under this section is referred to in this Part as an individual exemption.

(3) The exemption-

(a) may be granted subject to such conditions or obligations as the Director considers it appropriate to impose; and

(b) has effect for such period as the Director considers appropriate.

(4) That period must be specified in the grant of the exemption.

(5) An individual exemption may be granted so as to have effect from a date earlier than that on which it is granted.

(6) On an application made in such way as may be specified by rules under section 51, the Director may extend the period for which an exemption has effect; but, if the rules so provide, he may do so only in specified circumstances.