{"id":937,"date":"2019-03-29T21:14:30","date_gmt":"2019-03-29T21:14:30","guid":{"rendered":"https:\/\/blogs.qub.ac.uk\/studentlawjournal\/?p=937"},"modified":"2019-03-29T21:15:18","modified_gmt":"2019-03-29T21:15:18","slug":"the-consequences-of-brexit-on-consumers-and-businesses-in-uk-competition-law","status":"publish","type":"post","link":"https:\/\/blogs.qub.ac.uk\/studentlawjournal\/2019\/03\/29\/the-consequences-of-brexit-on-consumers-and-businesses-in-uk-competition-law\/","title":{"rendered":"The Consequences of Brexit on Consumers and Businesses in UK Competition Law."},"content":{"rendered":"\n

The Consequences of Brexit on Consumers and Businesses in <\/strong>UK<\/strong> Competition Law.
Author: Chi Hoe Tang <\/strong>
Queen’s University, Belfast<\/strong><\/p>\n\n\n\n

This essay constitutes a critical analysis of the consequences of Brexit in the area of competition law with respect to consumers and businesses in the UK. It is submitted that Brexit\u2019s consequences will be \u2018negligible\u2019 to businesses and consumers in the event that the draft Withdrawal Agreement on Brexit [1] is ratified, but not if the UK faces a \u2018no deal\u2019 scenario. This proposition is predicated on two working assumptions. Firstly, Theresa May\u2019s commitment to her vision of a post-Brexit scenario in which the UK fully withdraws from the European Economic Area (EEA) and the Internal Market will be realised. [2] Such a scenario lends itself well to discourse because a post-Brexit scenario where the UK remains a member of the EEA would have little effect on consumers and businesses in terms of competition law as EU competition law provisions are mirrored in the EEA Agreement. [3] Secondly, it is assumed that the trajectory of UK competition law post-Brexit will be as it was pre-Brexit based on the history of its development. Due to the expansive scope of competition law, this essay will be limited to a discussion of potential changes Brexit will bring to the subareas of antitrust and mergers. A comparison will be made of the similarities and contrasts between the current competition framework in the aforementioned areas and the potential post-Brexit changes in order to appreciate the consequences of these alterations on UK consumers and businesses.<\/p>\n\n\n\n

Brexit \u2013 Withdrawal Agreement or \u2018No Deal\u2019?<\/p>\n\n\n\n

On 29 March 2017, the UK Government\n(\u2018the Government\u2019)  invoked Article 50 of\nthe Treaty on European Union by formal notice to terminate its membership of\nthe EU following the results of the June 2016 EU referendum. [4] The European\nUnion (Withdrawal) Act 2018 was enacted to repeal the European Communities Act\n1972 [5] and incorporate EU law into domestic law while allowing Government the\nability to amend the retained EU law to mitigate deficiencies resulting from\nBrexit. [6] After a period of lengthy and fraught discussions, UK and EU\nnegotiators agreed to a draft Withdrawal Agreement, the text of which was\npublished by the European Commission on 14 November 2018. [7] The draft Withdrawal\nAgreement addresses a host of key issues relating to the aftermath of Brexit,\nthe most pertinent to competition law being the arrangements concerning the\n\u2018transition period\u2019, during which the UK will effectively be treated by the EU\nas a Member State but without the right to take part in its policy-making. [8] The\nlack of UK involvement in EU-wide competition policy will diminish the UK\u2019s\nability to influence EU competition policy to continue reflecting its\n\u2018neoliberal\u2019 history of market-opening, corporatisation, deregulation and\nprivatisation of public enterprises. [9] This would adversely impact British\nconsumers and businesses in the event certain EU Member States decide to pursue\nmore protectionist policies as a means of protecting their own national\ninterests.<\/p>\n\n\n\n

It should be noted from the outset that\nthe implementation of the transition period is contentious and entirely\ndependent upon ratification of the draft Withdrawal Agreement by both UK and EU\nParliaments. [10] To suggest that the draft Withdrawal Agreement was not well\nreceived by all would be an understatement in light of the resignation of two\nUK Cabinet ministers in protest following its announcement. [11] Failure to\nratify would result in a \u2018no deal\u2019 Brexit where the UK would cease to be a\nmember of the EU on 29 March 2019 (\u2018Brexit Day\u2019) with no transition period in\nplace. [12]<\/p>\n\n\n\n

The consequences of Brexit on consumers\nand businesses in the area of competition law will vary depending on whether\nthe draft Withdrawal Agreement is ultimately ratified and a transition period\nis implemented, or whether the UK faces a \u2018no deal\u2019 scenario with no transition\nperiod. This essay will examine the consequences of both scenarios.<\/p>\n\n\n\n

Antitrust<\/p>\n\n\n\n

In brief, the current pre-Brexit\ncompetition law framework is as follows. Under domestic competition law, the\nkey provisions on antitrust are contained in the Competition Act 1998 (\u2018CA\n1998\u2019). [13] Chapter I prohibits anticompetitive agreements whereas Chapter II\nprohibits abuse of a dominant market position. [14] These provisions are\nsubstantively similar to Articles 101 and 102 of the Treaty on the Functioning\nof the European Union (\u2018TFEU\u2019), differing only with regard to territorial\nscope. [15] Articles 101 and 102 TFEU apply in circumstances where trade\nbetween EU Member States is affected. The alignment of domestic competition law\nwith EU competition law is further reinforced by Section 60 of CA 1998 which\nrequires the provisions of the 1998 Act to be interpreted consistently with EU\nlaw [16] as affirmed in Walt Wilhelm v\nBundeskartellamt<\/em>. [17] Domestic antitrust prohibitions are enforced by the\nCompetition and Markets Authority (\u2018CMA\u2019). [18] The\nEuropean Commission is responsible for enforcing prohibitions under Articles\n101 and 102 TFEU. [19] Its decisions may be appealed to the Courts of Justice\nof the European Union (\u2018CJEU\u2019). Private claimants, such as businesses and\nconsumers, may rely on a European Commission decision finding infringement of\nthe aforementioned Articles to pursue a follow-on claim.[20] The CMA is also\nempowered to enforce Articles 101 and 102 TFEU. [21] Decisions of the CMA with\nregard to antitrust infringements under TFEU may be appealed to the Competition\nAppeal Tribunal (\u2018CAT\u2019). [22]<\/p>\n\n\n\n

Any change to this integration of EU\nand UK antitrust law and enforcement will invariably have consequences on both\nbusinesses, who must conform to antitrust legislation; and consumers, who have\nthe right to bring a private action against companies in breach of antitrust\nprovisions. However, a study of the draft Withdrawal Agreement and the\nPolitical Declaration drafted alongside it reveals that there will likely not\nbe any substantive or procedural change to current antitrust laws should the\ndraft Withdrawal Agreement be ratified, at least not during the transition period.\nThis is because EU law will continue to apply in the UK until the end of\ntransition period on 31 December 2020 [23] as per Article 127 of the draft\nWithdrawal Agreement. [24] The European Commission will therefore still be\nempowered to enforce EU antitrust law with the same investigative powers as\noutlined in Council Regulation (EC) 1\/2003. [25] The continued application of\nEU law also implies the continued application of \u2018parallel exemptions\u2019 under\nSection 10 of CA 1998, whereby any agreement benefitting from EU Block\nExemption Regulations, or a Commission exemption will be automatically exempt from\nthe Chapter I prohibition. [26] Block exemptions adopted by the Commission are\nexempt from being caught under Article 101(1) TFEU by virtue of Article 101(3)\nTFEU. [27] Article 127(3) of the draft Withdrawal Agreement states that \u2018During\nthe transition period, the Union law applicable \u2026 shall be interpreted and\napplied in accordance with the same methods and general principles as those\napplicable within the Union\u2019. [28] This would require the CMA and CAT to\ninterpret UK antitrust law to be consistent with EU competition law during the\ntransition period. In addition, Section 60 of CA 1998 would have to be retained\nin order to give effect to the provision. <\/p>\n\n\n\n

At the end of the transition period,\nthe Government has the choice of pursuing one of two options; extending the\ntransition period subject to mutual agreement, or implementing the backstop\nsolution as codified in the draft Withdrawal Agreement Protocol on Ireland and\nNorthern Ireland (\u2018the Protocol\u2019). [29] The antitrust framework during the\nextended transition period will be as discussed above.  Article 6 of the Protocol creates a \u2018single\ncustoms territory\u2019 between the UK and EU. [30] The enforcement of this single\ncustoms territory will require the Government to implement new antitrust laws\nas stipulated in the Protocol [31] to maintain a \u2018level playing field\u2019. [32] Again,\nthe pre-Brexit antitrust framework will be maintained throughout the backstop\nperiod given that the antitrust laws listed under the Protocol use similar\nwording to the prohibitions under Articles 101 and 102 TFEU. [33] It is\ntherefore argued that, in the scenario where the draft Withdrawal Agreement is\nratified, the consequences to businesses and consumers will indeed be\nnegligible as the antitrust framework during the transition and backstop\nperiods would be largely unaltered from the existing framework.<\/p>\n\n\n\n

In the event of a \u2018no deal\u2019 Brexit, the\ndiscussion on post-Brexit competition law and policy must be framed bearing in\nmind the Government\u2019s desire for \u2018a smooth and orderly exit\u2019 from the EU. [34]\nHence, it is likely that no fundamental change in the UK\u2019s competition law\nregime will be made to reflect this based on the Government\u2019s response to the\nHouse of Lords EU Internal Market subcommittee report on the impact of Brexit\non the UK competition law framework. [35] \nAs EU law will cease to apply on Brexit Day, Section 60 of CA 1998 which\nbinds the CMA and CAT to act consistently with EU competition law would have to\nbe repealed. With regard to block exemptions, the Government intends to incorporate\nEU Block Exemptions Regulations until their expiration by way of the European\nUnion (Withdrawal) Act 2018. [36] The implementation of new Block Exemption\nOrders to mirror Regulations enacted by the Commission after Brexit Day will be\nat the discretion of the Government under Section 6 of CA 1998. [37] Hence,\nbusinesses currently enjoying the benefits of EU block exemptions will continue\nto be able to do so, at least until their expiration. <\/p>\n\n\n\n

The discussion above, premised on\nGovernment publications on the future of the UK\u2019s antitrust framework, firmly\nindicates that there will be no drastic change to substantive domestic\nantitrust provisions bar a few tweaks such as the potential replacement of\nsection 60 of CA 1998 to ensure antitrust legislation remains operational in a\npost-Brexit environment. This means little change in the way businesses must\nconform to antitrust legislation. As for the potential consequences for\nconsumers, the private enforcement of antitrust law must be examined in the event\nthe draft Withdrawal Agreement is ratified, or whether a \u2018no deal\u2019 scenario\noccurs. If ratification occurs, EU competition law continues to apply as\ndiscussed and there will be no impact on consumers in regard to private\nenforcement. In the case of a \u2018no deal\u2019 scenario, guidance on how private\nenforcement of antitrust law may be gleaned from the Government\u2019s explanatory\nmemorandum to the Competition (Amendment etc.) (EU Exit) Regulations 2019. [38]\nThe aforementioned statutory instrument was drafted, in accordance with the\nEuropean Union (Withdrawal) Act 2018, [39] to amend domestic competition\nlegislation to omit references to EU law and duties relating to EU obligations,\nneither of which will apply as a result of a \u2018no deal\u2019 Brexit. [40] As\nclarified in the explanatory memorandum, Section 60 of CA 1998 will be replaced\nwith Section 60A which provides that: <\/p>\n\n\n\n

Competition regulators and UK courts\nwill continue to be bound by an obligation to ensure no inconsistency with\npre-exit EU competition case law when interpreting UK competition law, but that\nthey may depart from such pre-exit EU case law where it is considered\nappropriate in the light of specified circumstances. [41]<\/p>\n\n\n\n

Section 60A will apply regardless of whether the\ninfringement occurred before or after Brexit Day. [42] The provision allows the\nCMA and CAT to adhere to EU competition case law while allowing for the\npossibility of future divergence between the competition case law of the two\njurisdictions. It is therefore submitted that this preserves legal\ncertainty for businesses and consumers who wish to bring claims for antitrust\ninfringements. In addition, follow-on claims based on Commission decisions may\nonly be heard in English courts if the decision was made before Brexit Day.\n[43] However, follow-on claims may still be made based on CMA decisions under\nUK law. [44] Since substantive competition case law of the UK is similar to\nthat of the EU as divergence in competition case law has not yet had the\nopportunity to occur, it is submitted that the English courts will likely take\nEU competition case law into account even though they are not bound to do so in\norder to ensure legal certainty for businesses and consumers in the short-term.\n<\/p>\n\n\n\n

            Another\naspect to consider in relation to post-Brexit antitrust enforcement is the\njurisdiction of the Commission, specifically its investigatory powers. If the\ndraft Withdrawal Agreement is ratified, the Commission\u2019s broad powers of\ninvestigation into antitrust matters will remain as they are under Council\nRegulation 1\/2003 so long as the Commission initiates proceedings before the\nend of the transition period given the fact that EU law will cease to apply in\nthe UK when the transition period ends. In a \u2018no deal\u2019 Brexit, the Commission\u2019s\npowers to conduct investigations on UK business premises will be removed. [45]\nThe CMA will be able to investigate antitrust breaches which occurred before\nand after Brexit Day, provided the Commission had not made a decision on the\nbreach before Brexit Day. [46] In other words, the CMA may commence an\ninvestigation in relation to conduct the Commission is investigating, but has\nnot published a decision by Brexit Day. Parallel investigations into the same\nconduct by the Commission and CMA may require settlement considerations and\nleniency applications to be considered in both jurisdictions simultaneously. A\n\u2018no deal\u2019 Brexit would therefore diminish the incentive of a cartel member to\napply for leniency because the individual would now have to apply for leniency\nin multiple jurisdictions for protection. Prior to Brexit, the individual would\nhave been protected in the UK by applying for leniency in any Member State of\nthe EU. [47] It is submitted that the diminished effectiveness of leniency\nprogrammes would adversely affect consumers by reducing competition in the UK.<\/p>\n\n\n\n

Merger Control<\/p>\n\n\n\n

            Any\npotential change to the merger control regime in the UK post-Brexit will be of\nprimary concern to businesses considering a merger transaction. Consumers also\nhave an interest in there being a strong merger control regime to fulfil the\npurpose of preventing mergers which \u2018significantly impede effective competition\nin the \u2026 market\u2019 [48] which would be detrimental to them. Mergers in the UK are\ngoverned by the Enterprise Act 2002 (\u2018EA 2002\u2019) which provides the CMA with\ndecision-making powers to mitigate or prevent mergers expected to result in a\n\u2018substantial lessening of competition\u2019. [49] The EA 2002 currently gives effect\nto the EU Merger Regulation (\u2018EUMR\u2019), most notably the provision establishing\nthe \u2018one-stop shop\u2019 merger control regime in which the Commission has exclusive\ncompetence to review mergers that meet certain turnover thresholds. [50] A\nBrexit following ratification of the draft Withdrawal Agreement would have no\nimmediate effect on consumers and businesses in the sphere of merger control\nbecause EU law, including the EUMR, will continue to apply throughout the\ntransition period. [51] <\/p>\n\n\n\n

In a \u2018no deal\u2019 scenario, the Government\nwill revoke the EUMR and amend the EA 2002 by way of statutory instrument under\nthe European Union (Withdrawal) Act 2018.[1]<\/sup><\/a> The\namendments will be made only insofar as to \u2018render the statute book functional\u2019\nto remove references to EU law and institutions. [53] A palpable consequence of\nthis is the loss of the \u2018one-stop shop\u2019 for UK companies. The CMA would be able\nto investigate all mergers affecting the UK market regardless of whether the\nsame transaction is being investigated by the Commission. [54] If the\nCommission has not issued a decision by Brexit Day, the CMA would have jurisdiction\nto review the transaction. [55] As such, businesses are advised in the\nGovernment\u2019s technical notice to seek early engagement with the CMA and the\nCommission if they anticipate that it is likely the Commission will be unable\nto issue a decision by Brexit Day. [56] Businesses considering a merger\npost-Brexit that would affect both the UK and EU would have to conform to the\nmerger rules of both jurisdictions which would incur a greater financial\nburden. Moreover, it is argued that parallel filings to the CMA and the\nCommission may result in great inconvenience for businesses should CMA decide\nnot to synchronise its merger review timetable with that of the Commission,\nwhich it has no obligation to do. The increased merger review work that the CMA\nwould have to undertake would force it to divert its resources from its other\nfunctions such as antitrust enforcement and market investigations. As a result,\nconsumers would be adversely affected by any reduction in competition as a\nresult of weakened antitrust enforcement resulting from the loss of the\n\u2018one-stop shop\u2019.<\/p>\n\n\n\n

Conclusion<\/p>\n\n\n\n

It has been shown that substantive\nantitrust law and the merger control regime in the UK will remain largely\nfamiliar to businesses and consumers regardless of whether the draft Withdrawal\nAgreement is ratified. If ratification occurs, the effects of Brexit on\nbusinesses and consumers in these subareas of competition law can indeed be\nsaid to be \u2018negligible\u2019 throughout the transition period in which EU law will\ncontinue to apply. The same cannot be said in a \u2018no deal\u2019 scenario. In relation\nto antitrust, the CMA and CAT would no longer be bound by Commission decisions,\n[57] consumers and businesses would not be able to make follow-on claims based\non Commission decisions made after Brexit day, [58] and leniency applications\nwould become less attractive as discussed above. In relation to mergers, the\nloss of the \u2018one-stop shop\u2019 would incur greater financial cost for businesses\nand indirectly harm consumers by diverting the CMA\u2019s resources to review\nmergers. Nevertheless, it is hoped that the CMA and UK courts will take EU\ncompetition case law into account in the interest of legal certainty for\nbusinesses and consumers, and that sufficient resources will be allocated to\nthe CMA to reflect its increased scope to diminish the adverse effects of a \u2018no\ndeal\u2019 Brexit. <\/p>\n\n\n\n

  1. European Commission, \u2018Draft Agreement on the\nWithdrawal of the United Kingdom of Great Britain and Northern Ireland from the\nEuropean Union and the European Atomic Energy Community, as Agreed at\nNegotiators’ Level on 14 November 2018\u2019 TF50 (2018) 55 \u2013 Commission to EU27.<\/li>
  2. Theresa May, \u2018PM Statement on Leaving the EU: 9\nOct 2017\u2019 (Prime Minister\u2019s Office<\/em>, 9\nOctober 2017)\n<https:\/\/www.gov.uk\/government\/speeches\/pm-statement-on-leaving-the-eu-9-oct-2017>\naccessed 18 November 2018. <\/li>
  3. Agreement on the European Economic Area [1994]\nOJ L001, arts 53-64. <\/li>
  4. \u2018Brexit \u2013 Article 50 Has Been Triggered: What\nNow?\u2019 (BBC<\/em>, 29 March 2017)\n<https:\/\/www.bbc.co.uk\/news\/uk-politics-39143978> accessed 19 November\n2018. <\/li>
  5. European Communities Act 1978.<\/li>
  6. European Union (Withdrawal) Act 2018 (EUWA\n2018), ss 3 and 8.<\/li>
  7. European Commission (n 1).<\/li>
  8. Ibid.<\/li>
  9. Niamh Dunne, \u2018Competition Law and Policy after\nBrexit\u2019 (Department of Law, The London\nSchool of Economics and Political Science<\/em>, March 2017)\n<http:\/\/eprints.lse.ac.uk\/71721\/1\/5%20Dunne_LSE%20Law%20-%20Policy%20Briefing%20Papers%20Brexit%20Special_Competition%20law%20and%20policy%20after%20BreBre.pdf>\naccessed 21 November 2018.<\/li>
  10. \u2018European Commission Recommends to the European\nCouncil (Article 50) to Find that Decisive Progress has been made in Brexit\nNegotiations\u2019 (European Commission \u2013\nPress Release<\/em>, 14 November 2018) <http:\/\/europa.eu\/rapid\/press-release_IP-18-6424_en.htm>\naccessed 21 November 2018.<\/li>
  11. Lizzy Buchan, \u2018What is the Brexit Deal? Theresa\nMay\u2019s Controversial Agreement with the EU Explained\u2019 (The Independent<\/em>, 16 November 2018)\n<https:\/\/www.independent.co.uk\/news\/uk\/politics\/brexit-deal-what-is-theresa-may-draft-agreement-irish-border-uk-citizens-cabinet-eu-a8635081.html>\naccessed 21 November 2018.<\/li>
  12. Billy Perrigo, \u2018Britain is Preparing for a \u201cNo\nDeal\u201d Brexit. Here\u2019s What That Means\u2019 (Time<\/em>,\n6 August 2018) <http:\/\/time.com\/5358452\/britain-no-deal-brexit\/> accessed\n21 November 2018.<\/li>
  13. Competition Act 1998 (CA 1998)<\/li>
  14. ibid, chapters I-II <\/li>
  15. Consolidated Version of the Treaty on the\nFunctioning of the European Union [2012] OJ C326 (TFEU), arts 101-102. <\/li>
  16. Competition Act 1998, s 60.<\/li>
  17. Case 14\/68 [1969] ECR 1.<\/li>
  18. Enterprise and Regulatory Reform Act 2013, s\n27(1).<\/li>
  19. Richard Whish and David Bailey, Competition Law<\/em> (8th<\/sup> edn, OUP\n2015) 56-57.<\/li>
  20. Competition Act 1998, s 47A.<\/li>
  21. The Designation of the Competition and Markets\nAuthority as a National Competition Authority Regulations 2014, SI 2014\/537,\nreg 2.<\/li>
  22. Competition Act 1998, s 46(3)(a) and (b).<\/li>
  23. European Commission (n 1) art 126.<\/li>
  24. European Commission (n 1) art 127.<\/li>
  25. Council Regulation (EC) 1\/2003 on the\nImplementation of the Rules on Competition laid Down in Articles 81 and 82 of\nthe Treaty (Text with EEA relevance) [2003] OJ L001.<\/li>
  26. Competition Act 1998, s 10.<\/li>
  27. TFEU (n 15) arts 101(1) and 101(3).<\/li>
  28. EUWA 2018 (n 6) art 127(3).<\/li>
  29. European Commission (n 1) Protocol on\nIreland\/Northern Ireland<\/li>
  30. European Commission (n 1) Protocol on\nIreland\/Northern Ireland, art 6(1).<\/li>
  31. European Commission (n 1) Protocol on\nIreland\/Northern Ireland, Annex 4, arts 16-24. \n<\/li>
  32. European Commission (n 1) Protocol on\nIreland\/Northern Ireland, art 6(1).<\/li>
  33. European Commission (n 1) Protocol on Ireland\/Northern\nIreland, Annex 4, arts 17-18.<\/li>
  34. Department for Business, Energy & Industrial\nStrategy, Merger Review and\nAnti-competitive Activity if There\u2019s No Brexit Deal <\/em>(Technical Notice,\n2018).<\/li>
  35. Andrew Griffiths, Government Response the House of Lords EU Internal Market Subcommittee\nReport on the Impact of Brexit on UK Competition and State Aid<\/em> (Government\nResponse, 2018).<\/li>
  36. Ibid.<\/li>
  37. Ibid.<\/li>
  38. The Competition (Amendment etc.) (EU Exit)\nRegulations 2019 (Competition SI 2019).<\/li>
  39. EUWA 2018 (n 6) s 8(1).<\/li>
  40. Department for Business, Energy and Industrial\nStrategy, \u2018Explanatory Memorandum to the Competition (Amendment Etc.) (EU Exit)\nRegulations 2019 No. XXXX\u2019 (2018)\n<http:\/\/www.legislation.gov.uk\/ukdsi\/2019\/9780111173930\/pdfs\/ukdsiem_9780111173930_en.pdf>\naccessed 28 November 2018.<\/li>
  41. ibid. <\/li>
  42. ibid. <\/li>
  43. Department for Business, Energy & Industrial\nStrategy (n 34).<\/li>
  44. ibid.<\/li>
  45. Ibid.<\/li>
  46. Ibid. <\/li>
  47. Liza Lovdahl Gormsen, \u2018FAQ: Brexit and UK\nCompetition Law\u2019 (British Institute of\nInternational and Comparative Law<\/em>, 2017)\n<https:\/\/www.biicl.org\/documents\/1581_faq_-_competition_law_and_brexit.pdf?showdocument=1>\naccessed 28 November 2018.<\/li>
  48. Case T-102\/96 Gencor v Commission<\/em> [1999] ECR II-753, para 106.<\/li>
  49. Enterprise Act 2002, pt 3.<\/li>
  50. Council Regulation (EC) No 139\/2004 of 20\nJanuary 2004 on the Control of Concentrations between Undertakings (the EC\nMerger Regulation) (Text with EEA Relevance) [2004] OJ L24\/1, arts 8 and 10.<\/li>
  51. European Commission (n 1) art 127.<\/li>
  52. EUWA 2018 (n 6) sch 4, para 1(1).<\/li>
  53. Department for Business, Energy and Industrial\nStrategy (n 40), s 2.12.<\/li>
  54. Department for Business, Energy and Industrial\nStrategy (n 34). <\/li>
  55. ibid.<\/li>
  56. ibid.<\/li>
  57. Competition SI 2019 (n 38) s 60A. <\/li>
  58. Department\nfor Business, Energy & Industrial Strategy (n 34).<\/li><\/ol>\n\n\n\n
    \n\n\n\n

    [1]<\/a>\nEUWA 2018 (n 6) sch 4, para 1(1).<\/p>\n","protected":false},"excerpt":{"rendered":"

    The Consequences of Brexit on Consumers and Businesses in UK Competition Law.Author: Chi Hoe Tang Queen’s University, Belfast This essay constitutes a critical analysis of the consequences of Brexit in the area of competition law with respect to consumers and businesses in the UK. It is submitted that Brexit\u2019s consequences will be \u2018negligible\u2019 to businesses and consumers in the event that the draft Withdrawal Agreement on Brexit [1] is ratified, but not if the UK faces a \u2018no deal\u2019 scenario. This proposition is predicated on two working assumptions. Firstly, Theresa May\u2019s commitment to her vision of a post-Brexit scenario in which the UK fully withdraws from the European Economic Area (EEA) and the Internal Market will be realised. [2] Such a scenario lends itself well to discourse because a post-Brexit scenario where the UK remains a member of the EEA would have little effect on consumers and businesses in terms of competition law as EU competition law provisions are mirrored in the EEA Agreement. [3] Secondly, it is assumed that the trajectory of UK competition law post-Brexit will be as it was pre-Brexit based on the history of its development. Due to the expansive scope of competition law, this essay will be limited to a discussion of potential changes Brexit will bring to the subareas of antitrust and mergers. A comparison will be made of the similarities and contrasts between the current competition framework in the aforementioned areas and the potential post-Brexit changes in order to appreciate the consequences of these alterations on UK consumers and businesses. Brexit \u2013 Withdrawal Agreement or \u2018No Deal\u2019? On 29 March 2017, the UK Government (\u2018the Government\u2019)  invoked Article 50 of the Treaty on European Union by formal notice to terminate its membership of the EU following the results of the June 2016 EU referendum. [4] The European Union (Withdrawal) Act 2018 was enacted to repeal the European Communities Act 1972 [5] and incorporate EU law into domestic law while allowing Government the ability to amend the retained EU law to mitigate deficiencies resulting from Brexit. [6] After a period of lengthy and fraught discussions, UK and EU negotiators agreed to a draft Withdrawal Agreement, the text of which was published by the European Commission on 14 November 2018. [7] The draft Withdrawal Agreement addresses a host of key issues relating to the aftermath of Brexit, the most pertinent to competition law being the arrangements concerning the \u2018transition period\u2019, during which the UK will effectively be treated by the EU as a Member State but without the right to take part in its policy-making. [8] The lack of UK involvement in EU-wide competition policy will diminish the UK\u2019s ability to influence EU competition policy to continue reflecting its \u2018neoliberal\u2019 history of market-opening, corporatisation, deregulation and privatisation of public enterprises. [9] This would adversely impact British consumers and businesses in the event certain EU Member States decide to pursue more protectionist policies as a means of protecting their own national interests. It should be noted from the outset that the implementation of the transition period is contentious and entirely dependent upon ratification of the draft Withdrawal Agreement by both UK and EU Parliaments. [10] To suggest that the draft Withdrawal Agreement was not well received by all would be an understatement in light of the resignation of two UK Cabinet ministers in protest following its announcement. [11] Failure to ratify would result in a \u2018no deal\u2019 Brexit where the UK would cease to be a member of the EU on 29 March 2019 (\u2018Brexit Day\u2019) with no transition period in place. [12] The consequences of Brexit on consumers and businesses in the area of competition law will vary depending on whether the draft Withdrawal Agreement is ultimately ratified and a transition period is implemented, or whether the UK faces a \u2018no deal\u2019 scenario with no transition period. This essay will examine the consequences of both scenarios. Antitrust In brief, the current pre-Brexit competition law framework is as follows. Under domestic competition law, the key provisions on antitrust are contained in the Competition Act 1998 (\u2018CA 1998\u2019). [13] Chapter I prohibits anticompetitive agreements whereas Chapter II prohibits abuse of a dominant market position. [14] These provisions are substantively similar to Articles 101 and 102 of the Treaty on the Functioning of the European Union (\u2018TFEU\u2019), differing only with regard to territorial scope. [15] Articles 101 and 102 TFEU apply in circumstances where trade between EU Member States is affected. The alignment of domestic competition law with EU competition law is further reinforced by Section 60 of CA 1998 which requires the provisions of the 1998 Act to be interpreted consistently with EU law [16] as affirmed in Walt Wilhelm v Bundeskartellamt. [17] Domestic antitrust prohibitions are enforced by the Competition and Markets Authority (\u2018CMA\u2019). [18] The European Commission is responsible for enforcing prohibitions under Articles 101 and 102 TFEU. [19] Its decisions may be appealed to the Courts of Justice of the European Union (\u2018CJEU\u2019). Private claimants, such as businesses and consumers, may rely on a European Commission decision finding infringement of the aforementioned Articles to pursue a follow-on claim.[20] The CMA is also empowered to enforce Articles 101 and 102 TFEU. [21] Decisions of the CMA with regard to antitrust infringements under TFEU may be appealed to the Competition Appeal Tribunal (\u2018CAT\u2019). [22] Any change to this integration of EU and UK antitrust law and enforcement will invariably have consequences on both businesses, who must conform to antitrust legislation; and consumers, who have the right to bring a private action against companies in breach of antitrust provisions. However, a study of the draft Withdrawal Agreement and the Political Declaration drafted alongside it reveals that there will likely not be any substantive or procedural change to current antitrust laws should the draft Withdrawal Agreement be ratified, at least not during the transition period. This is because EU law will continue to apply in the UK until the end of transition period on 31 December 2020 [23] as per Article 127 of the draft Withdrawal Agreement. [24] The European Commission will therefore still be empowered to enforce EU antitrust law with the same investigative powers as outlined in Council Regulation (EC) 1\/2003. [25] The continued application of EU law also implies the continued application of \u2018parallel exemptions\u2019 under Section 10 of CA 1998, whereby any agreement benefitting from EU Block Exemption Regulations, or a Commission exemption will be automatically exempt from the Chapter I prohibition. [26] Block exemptions adopted by the Commission are exempt from being caught under Article 101(1) TFEU by virtue of Article 101(3) TFEU. [27] Article 127(3) of the draft Withdrawal Agreement states that \u2018During the transition period, the Union law applicable \u2026 shall be interpreted and applied in accordance with the same methods and general principles as those applicable within the Union\u2019. [28] This would require the CMA and CAT to interpret UK antitrust law to be consistent with EU competition law during the transition period. In addition, Section 60 of CA 1998 would have to be retained in order to give effect to the provision. At the end of the transition period, the Government has the choice of pursuing one of two options; extending the transition period subject to mutual agreement, or implementing the backstop solution as codified in the draft Withdrawal Agreement Protocol on Ireland and Northern Ireland (\u2018the Protocol\u2019). [29] The antitrust framework during the extended transition period will be as discussed above.  Article 6 of the Protocol creates a \u2018single customs territory\u2019 between the UK and EU. [30] The enforcement of this single customs territory will require the Government to implement new antitrust laws as stipulated in the Protocol [31] to maintain a \u2018level playing field\u2019. [32] Again, the pre-Brexit antitrust framework will be maintained throughout the backstop period given that the antitrust laws listed under the Protocol use similar wording to the prohibitions under Articles 101 and 102 TFEU. [33] It is therefore argued that, in the scenario where the draft Withdrawal Agreement is ratified, the consequences to businesses and consumers will indeed be negligible as the antitrust framework during the transition and backstop periods would be largely unaltered from the existing framework. In the event of a \u2018no deal\u2019 Brexit, the discussion on post-Brexit competition law and policy must be framed bearing in mind the Government\u2019s desire for \u2018a smooth and orderly exit\u2019 from the EU. [34] Hence, it is likely that no fundamental change in the UK\u2019s competition law regime will be made to reflect this based on the Government\u2019s response to the House of Lords EU Internal Market subcommittee report on the impact of Brexit on the UK competition law framework. [35]  As EU law will cease to apply on Brexit Day, Section 60 of CA 1998 which binds the CMA and CAT to act consistently with EU competition law would have to be repealed. With regard to block exemptions, the Government intends to incorporate EU Block Exemptions Regulations until their expiration by way of the European Union (Withdrawal) Act 2018. [36] The implementation of new Block Exemption Orders to mirror Regulations enacted by the Commission after Brexit Day will be at the discretion of the Government under Section 6 of CA 1998. [37] Hence, businesses currently enjoying the benefits of EU block exemptions will continue to be able to do so, at least until their expiration. The discussion above, premised on Government publications on the future of the UK\u2019s antitrust framework, firmly indicates that there will be no drastic change to substantive domestic antitrust provisions bar a few tweaks such as the potential replacement of section 60 of CA 1998 to ensure antitrust legislation remains operational in a post-Brexit environment. This means little change in the way businesses must conform to antitrust legislation. As for the potential consequences for consumers, the private enforcement of antitrust law must be examined in the event the draft Withdrawal Agreement is ratified, or whether a \u2018no deal\u2019 scenario occurs. If ratification occurs, EU competition law continues to apply as discussed and there will be no impact on consumers in regard to private enforcement. In the case of a \u2018no deal\u2019 scenario, guidance on how private enforcement of antitrust law may be gleaned from the Government\u2019s explanatory memorandum to the Competition (Amendment etc.) (EU Exit) Regulations 2019. [38] The aforementioned statutory instrument was drafted, in accordance with the European Union (Withdrawal) Act 2018, [39] to amend domestic competition legislation to omit references to EU law and duties relating to EU obligations, neither of which will apply as a result of a \u2018no deal\u2019 Brexit. [40] As clarified in the explanatory memorandum, Section 60 of CA 1998 will be replaced with Section 60A which provides that: Competition regulators and UK courts will continue to be bound by an obligation to ensure no inconsistency with pre-exit EU competition case law when interpreting UK competition law, but that they may depart from such pre-exit EU case law where it is considered appropriate in the light of specified circumstances. [41] Section 60A will apply regardless of whether the infringement occurred before or after Brexit Day. [42] The provision allows the CMA and CAT to adhere to EU competition case law while allowing for the possibility of future divergence between the competition case law of the two jurisdictions. It is therefore submitted that this preserves legal certainty for businesses and consumers who wish to bring claims for antitrust infringements. In addition, follow-on claims based on Commission decisions may only be heard in English courts if the decision was made before Brexit Day. [43] However, follow-on claims may still be made based on CMA decisions under UK law. [44] Since substantive competition case law of the UK is similar to that of the EU as divergence in competition case law has not yet had the opportunity to occur, it is submitted that the English courts will likely take EU competition case law into account even though they are not bound to do so in order…<\/p>\n","protected":false},"author":415,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"footnotes":""},"categories":[90],"tags":[],"class_list":["post-937","post","type-post","status-publish","format-standard","hentry","category-issue-five"],"jetpack_featured_media_url":"","jetpack_sharing_enabled":true,"jetpack_shortlink":"https:\/\/wp.me\/pa93oW-f7","_links":{"self":[{"href":"https:\/\/blogs.qub.ac.uk\/studentlawjournal\/wp-json\/wp\/v2\/posts\/937","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/blogs.qub.ac.uk\/studentlawjournal\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/blogs.qub.ac.uk\/studentlawjournal\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/blogs.qub.ac.uk\/studentlawjournal\/wp-json\/wp\/v2\/users\/415"}],"replies":[{"embeddable":true,"href":"https:\/\/blogs.qub.ac.uk\/studentlawjournal\/wp-json\/wp\/v2\/comments?post=937"}],"version-history":[{"count":1,"href":"https:\/\/blogs.qub.ac.uk\/studentlawjournal\/wp-json\/wp\/v2\/posts\/937\/revisions"}],"predecessor-version":[{"id":939,"href":"https:\/\/blogs.qub.ac.uk\/studentlawjournal\/wp-json\/wp\/v2\/posts\/937\/revisions\/939"}],"wp:attachment":[{"href":"https:\/\/blogs.qub.ac.uk\/studentlawjournal\/wp-json\/wp\/v2\/media?parent=937"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/blogs.qub.ac.uk\/studentlawjournal\/wp-json\/wp\/v2\/categories?post=937"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/blogs.qub.ac.uk\/studentlawjournal\/wp-json\/wp\/v2\/tags?post=937"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}