What next for the Competition and Markets Authority?

On 15 December 2022, the UK Competition and Markets Authority (CMA) launched a consultation on its draft annual plan for 2023 to 2024.  CMA Annual Plan consultation 2023 to 2024 - GOV.UK (www.gov.uk) The draft annual plan sets out the CMA’s areas of focus within the context of the organisation’s purpose, ambition and proposed medium-term priorities for the next 3 years.  It therefore provides businesses and organisations with a steer on the key areas and sectors in which the CMA is likely to be active.  As food & agriculture continues to be of interest to the CMA, the CMA’s draft annual plan will be of particular interest to businesses in this sector. 

What is the focus of the annual plan?

The CMA’s purpose of helping people, businesses and the UK economy by promoting competitive markets and tackling unfair behaviour is at the heart of the draft plan.  The draft plan builds on the CMA’s purpose by setting out the outcomes that it aims to achieve for people, businesses and the UK economy:

• People can be confident that they are getting great choices and fair deals;
• Competitive, fair-dealing businesses can innovate and thrive; and
• The whole UK economy can grow productively and sustainably.

These ambitions have been formulated against the backdrop of significant macro factors such as the rising cost of living and climate change; rapidly developing technologies and new business models, meaning that in carrying out its work the CMA must anticipate how markets and competition dynamics could evolve; and the CMA’s new responsibilities following the UK’s exit from the European Union.  These include setting up the new Subsidy Advice Unit (SAU), the Office for the Internal Market (OIM) and the Digital Markets Unit (DMU).  The DMU is expected to be the vehicle for the new pro-competition digital regulatory regime, which the Government has committed to introducing through new legislation in the current parliamentary session.

What action is the CMA targeting for 2023-2024?

In addition to setting out its medium-term priorities, the draft plan sets out the specific areas of focus (these are additional to the significant proportion of work carried out by the CMA that is not discretionary e.g., reviewing mergers) across the three areas of ambition during the 12-month reporting period starting on 1 April 2023.  These are as follows:

People

Historically the CMA has prioritised action which protects vulnerable consumers.  This theme continues in its draft annual plan, with the CMA proposing to:

• Take action in areas of essential spending and where people are under particular financial pressure, such as accommodation and caring for ourselves and others;
• Address pressure selling and false or misleading pricing practices, including through online choice architecture; and
• Deter anti-competitive behaviour, including cartels in public procurement and labour markets, and other areas which have direct effects on public and household expenditure.  These include continuing to defend in court decisions which imposed fines for anti-competitive practices, including excessive prices and, in merger control, ensuring that important sectors (e.g., vets and dentists) are not subject to anticompetitive mergers.

Business

The CMA’s focus over the past year has been to help competitive, fair-dealing businesses innovate and thrive.  The CMA proposes to continue this by:

• Enabling innovating businesses to access digital markets, such as mobile browsers and the distribution of cloud gaming services, e-commerce and digital advertising; and
• Encouraging effective competition in emergent markets.

Whole UK economy

The CMA recognises that it has a continuing role to play in supporting innovation, productivity and growth across the whole UK economy.  The CMA therefore proposes to:

• Act in existing and emergent markets for sustainable products and services, supporting the transition to a net zero economy.  This includes work on “green” claims and energy efficiency, and working with businesses on how they can collaborate to accelerate game-changing technologies whilst complying with competition law;
• Identify and act in areas where the CMA can have the most positive impact on innovation and productivity, and influence the pro-competitive development of markets;
• Ensure digital markets are competitive, including through preparation for the introduction of new powers for the DMU;
• Identify economic risks the CMA is well-placed to address to support the resilience of the UK economy;
• Further develop the work of the OIM to provide expert, independent and trusted advice to support effective trading between the 4 nations of the UK; and
• Establish the work of the SAU.

What are the next steps?

The CMA has invited comments on its proposed areas of focus by 30 January 2023.  The CMA will publish a summary of responses, along with a final version of its annual plan, by the end of March 2023.

The CMA has also stated that after this consultation, it will review its existing “prioritisation principles”.  These are the principles that the CMA currently uses to guide its selection and choices of cases. The review will therefore be aimed at ensuring that these principles are aligned with the CMA’s newly stated ambitions and areas of focus.