Ten things you need to know about competition law

2024 has been one of the busiest years for competition law. In particular, there has been a sharp uptake in deals coming under investigation by the Competition and Markets Authority (CMA). There is a particular focus on Northern Irish companies as the CMA settles into its new base in Belfast outside of its London headquarters. A need for competition advice has come to the fore in the outworkings of the Windsor Framework. The strong success of Northern Irish businesses whose geographic location, amongst other things, has made them extremely attractive to competitors in Great Britain, the Republic of Ireland and internationally.

There is no doubt that we will continue to see a strong focus on the Northern Irish business sector from the CMA in 2025. With competition powers set to be revolutionised under new legislation this year, and ever-increasing awareness of competition issues amongst consumers, we set out below ten key competition rules you need to know:

1. There can be no merger, acquisition or joint venture if the transaction ‘substantially lessens competition’.

Whilst notification is voluntary, the CMA still has the ability to “call-in” and investigate completed mergers that give rise to competition concerns. Transactions that trigger the merger control powers of the CMA are those involving a 25% share of the market or where a party has a turnover of £70m.

2. A completed merger that was not notified to the CMA can be unwound.

The CMA can order the disposal of the acquired business at no minimum price.

3. There can be no exchange of a business’ commercially sensitive information pre-closing.

The due diligence process should be carefully controlled to minimise the competition risk.

4. A transaction can also become void if a mandatory notification to the government under the national security and investment regime is not made.

The transaction is notifiable if it involves one of the 17 sensitive areas of the economy including where a target company holds public contract requiring security clearance.

5. It is a criminal offence to enter into an agreement between competitors to rig bids, fix prices, share customers, or limit supply.

A cartel is the most serious form of anti-competitive agreement. Penalties include imprisonment for five years and company director disqualification for 15 years.

6. Any business which enjoys a very strong market position cannot refuse to supply. 

Dominant businesses have a special responsibility to act with regard to customers, competitors or suppliers.

7. A contract term that infringes competition law is void and can make the entire contract unenforceable.

This includes terms that restrict online sales, sale to certain territories or to certain customers.

8. An anti-competitive agreement does not need to be in writing to breach competition rules.

An informal conversation or implied understanding will also infringe competition law.

9. Public authorities cannot give support that would create an unfair advantage. Such support can be challenged as an illegal subsidy.

Under the Windsor Framework Agreement, both the UK subsidy control regime and EU state aid rules must be considered in the design of any subsidy scheme or application of state funding.

10. The CMA can carry out dawn raids at your business or home.

The CMA has extensive powers to conduct investigations, carry out interviews and seize documents. These powers are set to be enhanced under the new Digital Markets, Competition and Consumers Act in early 2025.

The A&L Goodbody competition team has recent and significant experience of advising clients across all aspects of EU and UK competition law, including merger control, national security and investment rules, state aid and subsidy regimes.

For more information, please contact Micaela Diver or Kathy Regan of the A&L Goodbody EU, Competition and Procurement team in Belfast.

Date published: 13 December 2024