On 20 July 2021, the UK Government’s Department for Digital, Culture, Media & Sport (“DCMS”) and Department for Business, Energy & Industrial Strategy (“BEIS”) published proposals for a new regulatory regime for digital markets alongside accompanying consultation documents (the “Consultation”). The Consultation seeks views from interested parties and closes on 1 October 2021.
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The UK’s post-Brexit Subsidy Control regime — what to expect
What is happening and why?
On 30 June, the UK Government announced its draft Subsidy Control Bill (the “Bill”) which sets out the framework for how the UK will subsidise businesses post-Brexit. The UK government has hailed the Bill as a major departure from the EU state aid rules. In practice, the Bill provides a framework for implementing the UK’s international commitments on subsidy control, as set out in the Trade and Cooperation Agreement agreed with the European Union, and in other existing international trade obligations and World Trade Organisation (“WTO”) rules.
The Bill introduces a decentralised subsidy control framework outlining principles with which public authorities must comply when awarding subsidies. One of the key aims of the Bill is to ensure that the subsidy control regime is not used to encourage a “race to the bottom” between different regions of the UK.
While there are some important differences as compared to the EU state aid regime, the fundamental principles are comparable and any subsidies given under the Northern Ireland Protocol will continue to be governed by EU rules.
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Update on the UK’s National Security and Investment Act – what investors need to know
UK Government Confirms Commencement Date and Scope of NSI Regime
The UK Government has announced that the National Security & Investment Act (“NSIA”) will come into force on January 4, 2022. The NSIA introduces mandatory notification and pre-clearance requirements for certain qualifying acquisitions of control of companies active in 17 ‘core’ sectors. The NSIA also enhances the powers of the UK Government to call-in for review other transactions which fall outside the mandatory notification regime but where national security concerns are considered to arise. The NSIA applies to all investors, irrespective of nationality, including those from the UK. To support the legislation, the UK Government has established an Investment Security Unit (“ISU”) within the Department of Business, Energy and Industrial Strategy (“BEIS”) to manage and lead the assessment of filings that are received, including voluntarily, under the NSIA regime. An overview of the NSIA is provided in our earlier blogs – UK National Security and Investment Bill is published and the National Security & Investment Law is approved by Parliament.
Emerging Trends in UK Competition Law Vlog Series – Part IV: Horizon Scanning
Covington’s four-part video series offers snapshot briefings on key emerging trends in UK Competition Law. In part four, James Marshall and Sophie Albrighton look across the horizon at the CMA’s plans for the future: what are the proposed reforms for competition law in the UK, what is the CMA looking to do post-pandemic, what are
Emerging Trends in UK Competition Law Vlog Series – Part III: Digital Markets
Covington’s four-part video series offers snapshot briefings on key emerging trends in UK Competition Law. In part three, James Marshall and Sophie Albrighton discuss digital markets, one of the key areas of focus of competition authorities around the world today, including in the UK. They are joined by guest speaker Martin Hansen, Of Counsel in
What you need to know about the CMA’s consultation on the Retained Vertical Agreements Block Exemption Regulation
The Competition and Markets Authority (“CMA”) is consulting on its proposed recommendation to the Secretary of State for Business, Energy and Industrial Strategy to replace the retained Vertical Agreements Block Exemption Regulation (“retained VABER”) with a new UK Vertical Agreements Block Exemption Order (“VABEO”).
The retained VABER is the European Commission Regulation No 330/2010, which was incorporated into UK law when the UK left the EU. The retained VABER currently provides a safe harbour for a wide range of vertical agreements, subject to certain thresholds being met. It expires on 31 May 2022 and is under review for replacement by the European Commission. Following Brexit, businesses will not benefit from any replacement to the VABER at EU level in relation to their UK activities. The CMA has therefore consulted with businesses, industry associations and professional advisers to consider whether a UK-specific equivalent is required. Following this initial consultation process, the CMA recommends introducing a UK-specific equivalent VABEO from 1 June 2022.
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Emerging Trends in UK Competition Law Vlog Series – Part II: Enforcement and Litigation
Covington’s four-part video series offers snapshot briefings on key emerging trends in UK Competition Law. In part two, James Marshall and Sophie Albrighton focus on current trends in enforcement and litigation. They are joined by guest speaker Louise Freeman, co-chair of Covington’s Commercial Litigation and European Dispute Resolution Practice Groups, who has extensive experience
Emerging Trends in UK Competition Law Vlog Series – Part I: Merger Control
Covington’s four-part video series offers snapshot briefings on key emerging trends in UK Competition Law. In the first part, James Marshall and Sophie Albrighton focus on current trends in merger control. They are joined by guest speaker Louise Nash, Corporate Partner in Covington’s London office with over 20 years’ experience of global acquisitions, divestitures
Proposals published for radical overhaul of UK competition regime following Brexit
On 16 February, John Penrose MP published his long-awaited report into the UK’s competition regime. Penrose was tasked by the UK Government with reviewing how the UK’s competition regime can:
- Play a central role in meeting the challenges of the post COVID-19 economy and in driving recovery. The Government’s Policy Paper stated that “the pandemic is the biggest threat the UK has faced in decades and overcoming it will require all the dynamism and creativity that exists across all sectors and in all regions and nations of the UK“;
- Contribute to the Government’s aim of levelling up across all nations and regions of the UK;
- Increase consumer trust, including by meeting the Conservative Party’s 2019 Manifesto commitment to tackle bad business practices, and ensure the competition regime is strong, swift, flexible and proportionate;
- Support UK disruptors taking risks on new ideas and challenging incumbents; and
- Make best use of data, technology and digital skills which are vital to the modern economy.
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UK Supreme Court lowers the bar for collective actions
The UK Supreme Court has today ruled in favour of Walter Merricks, the former head of the UK Financial Ombudsman Service., in a hotly-anticipated judgment in the first opt-out competition class action brought in the UK.
Background
Mr Merricks is the proposed class representative for 46.2 million people who, between 22 May 1992 and 21 June 2008, purchased goods and/or services from businesses in the UK that accepted MasterCard cards. Mr Merricks has valued that claim at in excess of £14 billion (and this sum will likely now be even greater, with interest having continued to run since the claim was filed in September 2016). Our commentary on the earlier Court of Appeal decision in the case, with which the Supreme Court largely agreed, can be found here.
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