Digital Markets, Competition and Consumers Act 2024

Pt.1

Digital Markets

Pt.1 Ch.1

Overview

s.1

Overview

s.1(1)

This Part—

s.1(1)(a)

confers functions on the CMA in relation to the regulation of competition in digital markets, and

s.1(1)(b)

makes related provision.

s.1(2)

Chapter 2 makes provision about the designation of undertakings as having strategic market status in respect of a digital activity.

s.1(3)

Chapter 3 provides for the CMA to be able to impose conduct requirements on a designated undertaking.

s.1(4)

Chapter 4 provides for the CMA to take steps to promote competition where it considers that activities of a designated undertaking are having an adverse effect on competition.

s.1(5)

Chapter 5 makes provision about a duty to report certain possible mergers involving a designated undertaking.

s.1(6)

Chapter 6 makes provision about investigatory powers and compliance reports in relation to a designated undertaking.

s.1(7)

Chapter 7 makes provision about enforcement and appeals in relation to functions of the CMA under this Part.

s.1(8)

Chapter 8 makes provision about administration and other matters in relation to functions of the CMA under this Part.

Pt.1 Ch.2

Strategic Market Status

Pt.1 Ch.2(crossheading)(power)(to)(designate)(undertaking)(as)(having)(sms)

Power to designate undertaking as having SMS

s.2

Designation of undertaking

s.2(1)

The CMA may designate an undertaking as having strategic market status (“SMS”) in respect of a digital activity carried out by the undertaking where the CMA considers that—

s.2(1)(a)

the digital activity is linked to the United Kingdom (see section 4), and

s.2(1)(b)

the undertaking meets the SMS conditions in respect of the digital activity.

s.2(2)

The SMS conditions are that the undertaking has— in respect of the digital activity.

s.2(2)(a)

substantial and entrenched market power (see section 5), and

s.2(2)(b)

a position of strategic significance (see section 6),

s.2(3)

Subsection (1) is subject to section 7 (the turnover condition).

s.2(4)

The CMA may only designate an undertaking as having SMS in respect of a digital activity after carrying out an SMS investigation in accordance with this Chapter.

s.3

Digital activities

s.3(1)

For the purposes of this Part, the following are “digital activities”—

s.3(1)(a)

the provision of a service by means of the internet, whether for consideration or otherwise;

s.3(1)(b)

the provision of one or more pieces of digital content, whether for consideration or otherwise;

s.3(1)(c)

any other activity carried out for the purposes of an activity within paragraph (a) or (b).

s.3(2)

For the purposes of this section, a service is provided by means of the internet even where it is provided by means of a combination of—

s.3(2)(a)

the internet, and

s.3(2)(b)

an electronic communications service (within the meaning given by section 32(2) of the Communications Act 2003).

s.3(3)

The CMA may treat two or more activities within subsection (1) that are carried out by a single undertaking as a single digital activity where—

s.3(3)(a)

the activities have substantially the same or similar purposes, or

s.3(3)(b)

the activities can be carried out in combination with each other to fulfil a specific purpose.

s.3(4)

In any notice or other document that the CMA is required to give or publish under or by virtue of this Part, the CMA may describe a digital activity by reference to the nature of the activity, brand names or both.

s.4

Link to the United Kingdom

A digital activity is linked to the United Kingdom for the purposes of section 2(1)(a) if—

s.4(a)

the digital activity has a significant number of UK users,

s.4(b)

the undertaking that carries out the digital activity carries on business in the United Kingdom in relation to the digital activity, or

s.4(c)

the digital activity or the way in which the undertaking carries on the digital activity is likely to have an immediate, substantial and foreseeable effect on trade in the United Kingdom.

s.5

Substantial and entrenched market power

In order to assess whether an undertaking has substantial and entrenched market power in respect of a digital activity for the purposes of section 2(2)(a), the CMA must carry out a forward-looking assessment of a period of at least 5 years, taking into account developments that—

s.5(a)

would be expected or foreseeable if the CMA did not designate the undertaking as having SMS in respect of the digital activity, and

s.5(b)

may affect the undertaking’s conduct in carrying out the digital activity.

s.6

Position of strategic significance

An undertaking has a position of strategic significance in respect of a digital activity for the purposes of section 2(2)(b) where one or more of the following conditions is met—

s.6(a)

the undertaking has achieved a position of significant size or scale in respect of the digital activity;

s.6(b)

a significant number of other undertakings use the digital activity as carried out by the undertaking in carrying on their business;

s.6(c)

the undertaking’s position in respect of the digital activity would allow it to extend its market power to a range of other activities;

s.6(d)

the undertaking’s position in respect of the digital activity allows it to determine or substantially influence the ways in which other undertakings conduct themselves, in respect of the digital activity or otherwise.

s.7

The turnover condition

s.7(1)

The CMA may not designate an undertaking as having SMS in respect of a digital activity unless the turnover condition is met in relation to the undertaking.

s.7(2)

The turnover condition is met in relation to an undertaking if the CMA estimates that—

s.7(2)(a)

the total value of the global turnover of an undertaking or, where the undertaking is part of a group, the global turnover of that group in the relevant period exceeds £25 billion, or

s.7(2)(b)

the total value of the UK turnover of an undertaking or, where the undertaking is part of a group, the UK turnover of that group in the relevant period exceeds £1 billion.

s.7(3)

The Secretary of State may by regulations amend either of the sums mentioned in subsection (2).

s.7(4)

Regulations under subsection (3) are subject to the affirmative procedure.

s.7(5)

The CMA must—

s.7(5)(a)

keep under review the sums mentioned in subsection (2), and

s.7(5)(b)

from time to time advise the Secretary of State as to whether the sums are still appropriate.

s.7(6)

In this section—

s.7(6)(a)

the “relevant period” means—

s.7(6)(a)(i)

the most recent period of 12 months (“period A”) in respect of which the CMA considers that it is able to make an estimate of the total value of the relevant turnover of the undertaking or group, or

s.7(6)(a)(ii)

if the CMA estimates that the relevant turnover of the undertaking or group in the period of 12 months ending immediately before period A was higher than the relevant turnover of the undertaking or group in period A, that earlier period of 12 months;

s.7(6)(b)

the “relevant turnover” of the undertaking or group is the UK turnover or, as the case may be, global turnover of the undertaking or group.

s.8

Turnover of an undertaking

s.8(1)

This section applies for the purposes of the turnover condition.

s.8(2)

The total value of the global turnover of an undertaking or group in the relevant period (as defined in section 7(6)) is, subject to regulations under subsection (4), the total value of the turnover of the undertaking or group arising in connection with any of its activities.

s.8(3)

The total value of the UK turnover of an undertaking or group in the relevant period is, subject to regulations under subsection (4), the total value of the turnover of the undertaking or group—

s.8(3)(a)

arising in connection with any of its activities, and

s.8(3)(b)

relating to UK users or UK customers.

s.8(4)

The Secretary of State may by regulations make provision about how the total value of the global turnover or UK turnover of an undertaking or group in a period is to be estimated for the purposes of the turnover condition.

s.8(5)

Regulations under subsection (4) may (among other things)—

s.8(5)(a)

make provision about amounts which are, or are not, to be regarded as comprising the turnover of an undertaking or group;

s.8(5)(b)

confer on the CMA the power to determine matters specified in the regulations (including the matter mentioned in paragraph (a)).

s.8(6)

Regulations under subsection (4) are subject to the negative procedure.

Pt.1 Ch.2(crossheading)(procedure)

Procedure

s.9

Initial SMS investigations

s.9(1)

The CMA may begin an initial SMS investigation where it has reasonable grounds to consider that it may be able to designate an undertaking as having SMS in respect of a digital activity in accordance with section 2.

s.9(2)

An “initial SMS investigation” is an investigation into whether to designate an undertaking as having SMS in respect of a digital activity where the undertaking is not already designated in respect of that activity (subject to section 10(4)).

s.9(3)

The CMA may begin an initial SMS investigation into whether to designate an undertaking as having SMS in respect of a digital activity even if it has previously made a decision not to designate the undertaking as having SMS in respect of that activity.

s.10

Further SMS investigations

s.10(1)

The CMA may begin a further SMS investigation in relation to the designation of a designated undertaking in respect of a relevant digital activity at any time during the designation period (see section 18) relating to that designation.

s.10(2)

The CMA must begin a further SMS investigation in relation to the designation of a designated undertaking in respect of a relevant digital activity not later than 9 months before the end of the designation period relating to that designation, if it is not already carrying one out at that time under subsection (1).

s.10(3)

A “further SMS investigation” is an investigation into whether—

s.10(3)(a)

to revoke a designated undertaking’s designation in respect of the relevant digital activity or to designate the undertaking again in respect of that activity, and

s.10(3)(b)

to make provision under section 17 (existing obligations).

s.10(4)

A further SMS investigation may also include an investigation into whether to designate the designated undertaking in respect of a digital activity that the CMA considers to be similar or connected to the relevant digital activity (whether instead of, or in addition to, the relevant digital activity).

s.11

Procedure relating to SMS investigations

s.11(1)

When the CMA begins an SMS investigation it must give the undertaking to which the investigation relates a notice (an “SMS investigation notice”).

s.11(2)

The SMS investigation notice must state—

s.11(2)(a)

in the case of an initial SMS investigation—

s.11(2)(a)(i)

the reasonable grounds mentioned in section 9(1);

s.11(2)(a)(ii)

that the CMA may close the investigation in accordance with section 12;

s.11(2)(b)

the purpose and scope of the SMS investigation;

s.11(2)(c)

the period by the end of which the CMA must give the undertaking a notice setting out its decisions as a result of the investigation (see section 14(2));

s.11(2)(d)

the circumstances in which that period may be extended (see section 104).

s.11(3)

The statement of the purpose and scope of the investigation must include a description of the undertaking and digital activities to which the investigation relates.

s.11(4)

The CMA must give the undertaking one or more revised versions of the SMS investigation notice if it changes its view of the purpose and scope of the investigation.

s.11(5)

As soon as reasonably practicable after giving an SMS investigation notice or a revised version of an SMS investigation notice, the CMA must—

s.11(5)(a)

publish the notice, and

s.11(5)(b)

give a copy of the notice to the FCA, OFCOM, the Information Commissioner, the Bank of England and the PRA.

s.12

Closing an initial SMS investigation without a decision

s.12(1)

The CMA may close an initial SMS investigation at any time before it has reached a final view on the matters mentioned in paragraphs (a) and (b) of section 2(1).

s.12(2)

When the CMA decides to close an initial SMS investigation, the CMA must give the undertaking to which the investigation related a notice to that effect.

s.12(3)

The notice must include the CMA’s reasons for closing the investigation.

s.12(4)

As soon as reasonably practicable after giving a notice under subsection (2), the CMA must publish the notice.

s.13

Consultation on proposed decision

s.13(1)

The CMA must—

s.13(1)(a)

carry out a public consultation on any decision that it is considering making as a result of an SMS investigation (see section 14(1)), and

s.13(1)(b)

bring the public consultation to the attention of such persons as it considers appropriate.

s.13(2)

Consultation under subsection (1) may be carried out at the same time as consultation under section 24(1) (consultation in relation to a conduct requirement).

s.14

Outcome of SMS investigations

s.14(1)

The CMA must—

s.14(1)(a)

in the case of an initial SMS investigation which it does not close under section 12, decide whether to designate the undertaking to which the investigation relates as having SMS in respect of a digital activity to which the investigation relates;

s.14(1)(b)

in the case of a further SMS investigation, make a decision on the matters mentioned in section 10(3) and, where relevant, section 10(4).

s.14(2)

The CMA must give the undertaking a notice (an “SMS decision notice”) setting out its decisions under subsection (1) on or before the last day of the period (the “SMS investigation period”) of 9 months beginning with the day on which the SMS investigation notice is given.

s.14(3)

The giving of a revised version of an SMS investigation notice under section 11(4) does not change the day on which the SMS investigation period begins.

s.14(4)

Sections 15 and 16 make provision about the content of an SMS decision notice.

s.14(5)

As soon as reasonably practicable after giving an SMS decision notice, the CMA must publish the notice.

s.14(6)

If the CMA does not give an SMS decision notice on or before the last day of the SMS investigation period, the CMA and the undertaking to which the investigation related are to be treated as if—

s.14(6)(a)

in the case of an initial SMS investigation, the CMA had given the undertaking an SMS decision notice stating that it had decided not to designate the undertaking in respect of any digital activity to which the investigation related, and

s.14(6)(b)

in the case of a further SMS investigation, the CMA had given an SMS decision notice stating that it had decided to revoke the designated undertaking’s designation in respect of the relevant digital activity with effect from the end of the SMS investigation period.

s.15

Notice requirements: decisions about whether to designate

s.15(1)

Where the CMA decides as a result of an initial SMS investigation not to designate the undertaking to which the investigation relates as having SMS in respect of a digital activity to which the investigation relates, the SMS decision notice must include the CMA’s reasons for its decision.

s.15(2)

Subsections (3) to (6) apply where the CMA decides to designate an undertaking as having SMS in respect of a digital activity (whether or not that undertaking is already a designated undertaking).

s.15(3)

The SMS decision notice must include—

s.15(3)(a)

a description of the designated undertaking,

s.15(3)(b)

a description of the digital activity with respect to which the designation has effect,

s.15(3)(c)

any provision that the CMA has decided to make in reliance on section 17 (existing obligations),

s.15(3)(d)

the CMA’s reasons for its decisions under section 14(1),

s.15(3)(e)

a statement of the period (the “designation period”) for which the designation has effect (see section 18),

s.15(3)(f)

a statement of the circumstances in which the designation period may be extended (see section 104), and

s.15(3)(g)

a statement of the circumstances in which the designation may be revoked before the end of the designation period (see sections 10 and 14(1)(b)).

s.15(4)

The CMA may give one or more revised versions of an SMS decision notice if it changes its view of— provided that the undertaking or digital activity, as the case may be, remains substantially the same.

s.15(4)(a)

the undertaking, or

s.15(4)(b)

the digital activity,

s.15(5)

The giving of a revised SMS decision notice providing for the designation of an undertaking does not affect—

s.15(5)(a)

the day on which the designation period in relation to that designation begins, or

s.15(5)(b)

anything done under this Part in relation to that undertaking.

s.15(6)

As soon as reasonably practicable after giving a revised SMS decision notice, the CMA must publish the revised notice.

s.16

Notice requirements: decisions to revoke a designation

s.16(1)

This section applies where the CMA decides, as a result of a further SMS investigation, to revoke the existing designation of a designated undertaking in respect of a digital activity without making a further designation in respect of that digital activity under section 14(1)(b).

s.16(2)

The SMS decision notice must provide for the revocation of the existing designation—

s.16(2)(a)

to have effect at the end of the day on which the notice is given, or

s.16(2)(b)

to have effect from such earlier time as the CMA may specify in the notice.

s.16(3)

The SMS decision notice must include—

s.16(3)(a)

any provision that the CMA has decided to make in reliance on section 17 (existing obligations);

s.16(3)(b)

the CMA’s reasons for its decisions under section 14(1)(b).

s.17

Existing obligations

s.17(1)

Where the CMA decides, as a result of a further SMS investigation, to revoke a designated undertaking’s designation in respect of a relevant digital activity, the CMA may make transitional, transitory or saving provision in respect of any existing obligation.

s.17(2)

Provision may be made in reliance on subsection (1) only for the purpose of managing the impact of the revocation—

s.17(2)(a)

on any person who benefited from the existing obligation, and

s.17(2)(b)

in a way that appears to the CMA to be fair and reasonable.

s.17(3)

In Chapters 6 (investigatory powers and compliance reports) and 7 (enforcement and appeals), references to a “designated undertaking” are to be read as including an undertaking to which an existing obligation applies by virtue of provision made in reliance on subsection (1).

s.17(4)

Subsection (5) applies where the CMA decides, as a result of a further SMS investigation, to—

s.17(4)(a)

designate an undertaking again in respect of a relevant digital activity, or

s.17(4)(b)

designate an undertaking in respect of a different digital activity in reliance on section 10(4).

s.17(5)

Where this subsection applies, the CMA may—

s.17(5)(a)

apply any existing obligation, with or without modification, to the designated undertaking in respect of the new designation;

s.17(5)(b)

make transitional, transitory or saving provision in respect of any existing obligation.

s.17(6)

For the purposes of this section, an “existing obligation” is any— that is in force in relation to a designated undertaking in respect of the relevant digital activity before the revocation mentioned in subsection (1) or, as the case may be, the designation mentioned in subsection (4).

s.17(6)(a)

conduct requirement (see section 19),

s.17(6)(b)

enforcement order (see section 31),

s.17(6)(c)

commitment (see sections 36 and 56);

s.17(6)(d)

final offer order (see section 41(2), or

s.17(6)(e)

pro-competition order (see section 46(3)(a)),

s.17(7)

Provision made in reliance on this section is to be included in an SMS decision notice.

s.18

Designation period

s.18(1)

Where the CMA decides to designate an undertaking as having SMS in respect of a digital activity, the designation period is 5 years beginning with the day after the day on which the SMS decision notice is given.

s.18(2)

See—

s.18(2)(a)

section 104 for circumstances in which the designation period may be extended, and

s.18(2)(b)

sections 10 and 14(1)(b) for circumstances in which a designation may be revoked before the end of the designation period.

Pt.1 Ch.3

Conduct requirements

Pt.1 Ch.3(crossheading)(imposition)(of)(conduct)(requirements)

Imposition of conduct requirements

s.19

Power to impose conduct requirements

s.19(1)

The CMA may impose one or more conduct requirements on a designated undertaking by giving the undertaking a notice containing the information set out in section 21.

s.19(2)

The CMA may vary a conduct requirement imposed on a designated undertaking by giving the undertaking a revised version of that notice.

s.19(3)

“Conduct requirements” are requirements as to how the designated undertaking must conduct itself in relation to a relevant digital activity, and references in this Part to imposing conduct requirements include references to varying conduct requirements in reliance on subsection (2).

s.19(4)

As soon as reasonably practicable after giving a notice under subsection (1) or (2), the CMA must publish the notice.

s.19(5)

The CMA may only impose a conduct requirement or a combination of conduct requirements on a designated undertaking if it considers that it would be proportionate to do so for the purposes of one or more of the following objectives— having regard to what the conduct requirement or combination of conduct requirements is intended to achieve.

s.19(5)(a)

the fair dealing objective,

s.19(5)(b)

the open choices objective, and

s.19(5)(c)

the trust and transparency objective,

s.19(6)

The fair dealing objective is that users or potential users of the relevant digital activity are—

s.19(6)(a)

treated fairly, and

s.19(6)(b)

able to interact, whether directly or indirectly, with the undertaking on reasonable terms.

s.19(7)

The open choices objective is that users or potential users of the relevant digital activity are able to choose freely and easily between the services or digital content provided by the undertaking and services or digital content provided by other undertakings.

s.19(8)

The trust and transparency objective is that users or potential users of the relevant digital activity have the information they require to enable them to—

s.19(8)(a)

understand the services or digital content provided by the undertaking through the relevant digital activity, including the terms on which they are provided, and

s.19(8)(b)

make properly informed decisions about whether and how they interact with the undertaking in respect of the relevant digital activity.

s.19(9)

A conduct requirement must be of a permitted type (see section 20).

s.19(10)

Before imposing a conduct requirement or a combination of conduct requirements on a designated undertaking, the CMA must have regard in particular to the benefits for consumers that the CMA considers would likely result (directly or indirectly) from the conduct requirement or combination of conduct requirements.

s.19(11)

A conduct requirement—

s.19(11)(a)

comes into force at a time determined by the CMA, and

s.19(11)(b)

ceases to have effect—

s.19(11)(b)(i)

in accordance with a decision of the CMA to revoke the requirement (see section 22), or

s.19(11)(b)(ii)

subject to provision made in reliance on section 17 (existing obligations), when the designation to which the requirement relates ceases to have effect.

s.20

Permitted types of conduct requirement

s.20(1)

Conduct requirements are of a permitted type if they are within subsection (2) or (3).

s.20(2)

Requirements are within this subsection if they are for the purpose of obliging a designated undertaking to—

s.20(2)(a)

trade on fair and reasonable terms;

s.20(2)(b)

have effective processes for handling complaints by and disputes with users or potential users;

s.20(2)(c)

provide clear, relevant, accurate and accessible information about the relevant digital activity to users or potential users;

s.20(2)(d)

give explanations, and a reasonable period of notice, to users or potential users of the relevant digital activity, before making changes in relation to the relevant digital activity where those changes are likely to have a material impact on the users or potential users;

s.20(2)(e)

present to users or potential users any options or default settings in relation to the relevant digital activity in a way that allows those users or potential users to make informed and effective decisions in their own best interests about those options or settings.

s.20(3)

Requirements are within this subsection if they are for the purpose of preventing a designated undertaking from—

s.20(3)(a)

applying discriminatory terms, conditions or policies to certain users or potential users or certain descriptions of users or potential users;

s.20(3)(b)

using its position in relation to the relevant digital activity, including its access to data relating to that activity, to treat its own products more favourably than those of other undertakings;

s.20(3)(c)

carrying on activities other than the relevant digital activity in a way that is likely to materially increase the undertaking’s market power, or materially strengthen its position of strategic significance, in relation to the relevant digital activity;

s.20(3)(d)

requiring or incentivising users or potential users of one of the designated undertaking’s products to use one or more of the undertaking’s other products alongside services or digital content the provision of which is, or is comprised in, the relevant digital activity;

s.20(3)(e)

restricting interoperability between the relevant service or digital content and products offered by other undertakings;

s.20(3)(f)

restricting whether or how users or potential users can use the relevant digital activity;

s.20(3)(g)

using data unfairly;

s.20(3)(h)

restricting the ability of users or potential users to use products of other undertakings.

s.20(4)

The Secretary of State may by regulations amend this section so as to modify the permitted types of requirement.

s.20(5)

Regulations under subsection (4) are subject to the affirmative procedure.

s.21

Content of notice imposing a conduct requirement

A notice under section 19(1) or (2) must include, in relation to each conduct requirement or, as the case may be, each conduct requirement as varied, a statement of—

s.21(a)

the conduct requirement and the relevant digital activity to which it relates;

s.21(b)

the CMA’s reasons for imposing the conduct requirement, including—

s.21(b)(i)

the objective for the purposes of which the CMA considers it is proportionate to impose the conduct requirement (see section 19(5)),

s.21(b)(ii)

the benefits that the CMA considers would likely result from the conduct requirement (see section 19(10)), and

s.21(b)(iii)

the permitted type of requirement to which the CMA considers the conduct requirement belongs (see section 20);

s.21(c)

when the conduct requirement comes into force;

s.21(d)

the last day of the designation period for the designation to which the conduct requirement relates;

s.21(e)

how the conduct requirement interacts with any other conduct requirement that has been imposed on the undertaking.

s.22

Revocation of conduct requirements

s.22(1)

The CMA may revoke a conduct requirement with effect from such time as the CMA may determine.

s.22(2)

Where the CMA decides to revoke a conduct requirement it must give the designated undertaking to which the requirement relates a notice specifying when the revocation is to have effect.

s.22(3)

As soon as reasonably practicable after giving the notice, the CMA must publish the notice.

s.23

Transitional provision relating to conduct requirements etc

s.23(1)

A notice under section 19(1) or (2) (content of notice imposing a conduct requirement), or under section 22(2) (revocation of conduct requirements), may include transitional, transitory or saving provision.

s.23(2)

The fact that a conduct requirement ceases to have effect does not affect the exercise of any digital markets functions in relation to a breach or possible breach of that requirement.

s.24

Consultation in relation to a conduct requirement

s.24(1)

Before imposing a conduct requirement on a designated undertaking, the CMA must—

s.24(1)(a)

carry out a public consultation on the conduct requirement which it proposes to impose, and

s.24(1)(b)

bring the public consultation to the attention of such persons as it considers appropriate.

s.24(2)

For the purposes of the consultation, the CMA must publish—

s.24(2)(a)

the conduct requirement which the CMA proposes to impose, or a description of that requirement, and

s.24(2)(b)

a statement of the permitted type of requirement to which the CMA considers the proposed conduct requirement belongs.

s.24(3)

Consultation under subsection (1) may be carried out at the same time as consultation under section 13 (consultation on proposed decision.

s.24(4)

Before revoking a conduct requirement, the CMA must—

s.24(4)(a)

carry out a public consultation on the proposed revocation, and

s.24(4)(b)

bring the public consultation to the attention of such persons as it considers appropriate.

s.25

Duty to keep conduct requirements under review

The CMA must keep under review, in relation to a designated undertaking—

s.25(a)

whether to impose, vary or revoke a conduct requirement;

s.25(b)

the extent to which it is complying with each conduct requirement to which it is subject;

s.25(c)

the effectiveness of each conduct requirement to which it is subject;

s.25(d)

whether to take action in accordance with sections 26 to35 (enforcement of conduct requirements) or Chapter 7 (enforcement and appeals) in respect of any breaches or suspected breaches of a conduct requirement.

Pt.1 Ch.3(crossheading)(enforcement)(of)(conduct)(requirements)

Enforcement of conduct requirements

s.26

Power to begin a conduct investigation

s.26(1)

The CMA may begin an investigation (a “conduct investigation”) where it has reasonable grounds to suspect that an undertaking has breached a conduct requirement.

s.26(2)

A conduct investigation is an investigation into—

s.26(2)(a)

whether a breach has occurred, and

s.26(2)(b)

if it has, what action, if any, the CMA should take in relation to the breach.

s.26(3)

When the CMA begins a conduct investigation it must give a notice (a “conduct investigation notice”) to the undertaking which it suspects has breached a conduct requirement.

s.26(4)

The conduct investigation notice must—

s.26(4)(a)

state the conduct requirement which the CMA suspects has been breached;

s.26(4)(b)

describe the conduct which the CMA suspects constituted the breach;

s.26(4)(c)

state the period within which the undertaking may make representations in relation to the conduct investigation (see subsection (5));

s.26(4)(d)

state the period by the end of which the CMA must give a notice to the undertaking setting out its findings as a result of the conduct investigation (see section 30(2));

s.26(4)(e)

state the circumstances in which that period may be extended (see section 104);

s.26(4)(f)

state the effect of the following provisions—

s.26(4)(f)(i)

section 28 (closing a conduct investigation without making a finding);

s.26(4)(f)(ii)

section 30 (notice of findings);

s.26(4)(f)(iii)

section 36 (commitments).

s.26(5)

The period mentioned in subsection (4)(c) is such period as the CMA may determine.

s.26(6)

As soon as reasonably practicable after giving a conduct investigation notice, the CMA must publish the conduct investigation notice.

s.27

Consideration of representations

Before making a finding that an undertaking to which a conduct investigation relates has breached or is breaching a conduct requirement, the CMA must consider any representations that the undertaking makes in relation to the conduct investigation.

s.28

Closing a conduct investigation without making a finding

s.28(1)

The CMA may close a conduct investigation at any time without making a finding as to whether or not a breach of a conduct requirement has occurred.

s.28(2)

When the CMA decides to close a conduct investigation, the CMA must give the undertaking to which the investigation related a notice to that effect.

s.28(3)

The notice must—

s.28(3)(a)

describe the undertaking in respect of which the CMA began the investigation,

s.28(3)(b)

state the conduct requirement to which the investigation related, and

s.28(3)(c)

include the CMA’s reasons for closing the investigation.

s.28(4)

As soon as reasonably practicable after giving a notice under subsection (2), the CMA must publish the notice.

s.29

Countervailing benefits exemption

s.29(1)

The CMA must close a conduct investigation under section 28 where representations made by the undertaking to which the investigation relates lead the CMA to consider that the countervailing benefits exemption applies.

s.29(2)

The countervailing benefits exemption applies where—

s.29(2)(a)

the conduct to which the investigation relates gives rise to benefits to users or potential users of the digital activity in respect of which the conduct requirement in question applies,

s.29(2)(b)

those benefits outweigh any actual or likely detrimental impact on competition resulting from a breach of the conduct requirement,

s.29(2)(c)

those benefits could not be realised without the conduct,

s.29(2)(d)

the conduct is proportionate to the realisation of those benefits, and

s.29(2)(e)

the conduct does not eliminate or prevent effective competition.

s.29(3)

Where the CMA closes a conduct investigation as a result of subsection (1), the undertaking to which the decision relates is to be treated as if the CMA had found that the conduct did not constitute a breach of the conduct requirement.

s.30

Notice of findings

s.30(1)

The CMA must give a notice to the undertaking to which a conduct investigation relates setting out its findings as a result of the conduct investigation (subject to subsection (5)).

s.30(2)

The notice must be given on or before the last day of the period (the “conduct investigation period”) of 6 months beginning with the day on which the conduct investigation notice is given to the undertaking.

s.30(3)

The notice must—

s.30(3)(a)

state whether or not the CMA has found that a breach has occurred, and

s.30(3)(b)

include reasons for the CMA’s findings.

s.30(4)

As soon as reasonably practicable after giving the notice, the CMA must publish the notice.

s.30(5)

Subsection (1) does not apply—

s.30(5)(a)

where the CMA closes the conduct investigation under section 28, or

s.30(5)(b)

in relation to any behaviour in respect of which the CMA has accepted a commitment from the undertaking (see section 36).

s.31

Enforcement orders

s.31(1)

Where the CMA finds, as a result of a conduct investigation, that an undertaking has breached a conduct requirement, it may make an order (an “enforcement order”) imposing on the undertaking such obligations as the CMA considers appropriate for one or more of the following purposes—

s.31(1)(a)

in a case where the breach is ongoing, stopping the breach;

s.31(1)(b)

preventing the breach from happening again;

s.31(1)(c)

addressing any damage caused by the breach.

s.31(2)

The CMA may vary an enforcement order by making a revised version of that order.

s.31(3)

An enforcement order may include transitional, transitory or saving provision.

s.31(4)

An enforcement order must—

s.31(4)(a)

specify the breach to which it relates;

s.31(4)(b)

include the CMA’s reasons for imposing the obligations in the order.

s.31(5)

The CMA may consult such persons as the CMA considers appropriate before making an enforcement order (including a revised version of an order).

s.31(6)

Where the CMA decides to make an enforcement order (other than an interim enforcement order under section 32), it must do so as soon as reasonably practicable after giving the undertaking a notice of its findings under section 30(1).

s.31(7)

As soon as reasonably practicable after making an enforcement order (including a revised version of an order), the CMA must publish the order.

s.31(8)

The CMA may consent to an undertaking acting in a way that would otherwise constitute a breach of an enforcement order.

s.32

Interim enforcement orders

s.32(1)

The CMA may make an enforcement order on an interim basis (an “interim enforcement order”) in relation to a suspected breach of a conduct requirement where—

s.32(1)(a)

the CMA has begun a conduct investigation in relation to the suspected breach, and

s.32(1)(b)

the CMA considers that it is necessary to act on an interim basis—

s.32(1)(b)(i)

to prevent significant damage to a particular person or category of person,

s.32(1)(b)(ii)

to prevent conduct which could reduce the effectiveness of any other steps the CMA might take in relation to the conduct requirement which it suspects the undertaking has breached or is breaching, or

s.32(1)(b)(iii)

to protect the public interest.

s.32(2)

An interim enforcement order must specify the suspected breach to which it relates.

s.32(3)

Before making an interim enforcement order, the CMA must give the undertaking to which it would relate an opportunity to make representations to it about the order which it proposes to make.

s.32(4)

But the duty in subsection (3) does not apply where the CMA considers that compliance would substantially reduce the effectiveness of the order.

s.32(5)

Where the CMA makes an interim enforcement order in relation to an undertaking without complying with subsection (3), the CMA must, as soon as reasonably practicable, give the undertaking a notice including—

s.32(5)(a)

the reasons for the CMA’s decision to make the interim enforcement order without complying with subsection (3), and

s.32(5)(b)

the period within which the undertaking may make representations in relation to the interim enforcement order (see subsection (7)).

s.32(6)

As soon as reasonably practicable after giving a notice under subsection (5), the CMA must publish the notice.

s.32(7)

The period mentioned in subsection (5)(b) is such period as the CMA may determine.

s.32(8)

The CMA must consider representations which it receives following a notice under subsection (5) as soon as reasonably practicable.

s.33

Duration of enforcement orders

s.33(1)

An enforcement order (including a revised version of an order) comes into force at such time as the CMA may specify in the order.

s.33(2)

An interim enforcement order ceases to have effect—

s.33(2)(a)

when revoked under section 34,

s.33(2)(b)

subject to provision made in reliance on section 17 (existing obligations), when the designation to which it relates ceases to have effect, or

s.33(2)(c)

when one of the following events occurs in relation to the suspected breach to which the order relates—

s.33(2)(c)(i)

the CMA gives the undertaking a notice stating that the CMA has found that no breach has occurred (see section 30);

s.33(2)(c)(ii)

the CMA accepts a commitment from the undertaking (see section 36);

s.33(2)(c)(iii)

the CMA makes an enforcement order (see section 31(1));

s.33(2)(c)(iv)

the CMA notifies the undertaking that it has decided not to make an enforcement order that is not an interim enforcement order.

s.33(3)

An enforcement order other than an interim enforcement order ceases to have effect—

s.33(3)(a)

when revoked under section 34, or

s.33(3)(b)

subject to provision made in reliance on section 17 (existing obligations), when the designation to which it relates ceases to have effect.

s.33(4)

The fact that an enforcement order ceases to have effect does not affect the exercise of any functions in relation to a breach or possible breach of that order.

s.34

Revocation of enforcement orders

s.34(1)

The CMA may revoke an enforcement order by giving a notice to that effect to the undertaking to which the order applies.

s.34(2)

The notice must include the reasons for the CMA’s decision to revoke the enforcement order.

s.34(3)

The notice may include transitional, transitory or saving provision in relation to the revocation of the enforcement order.

s.34(4)

As soon as reasonably practicable after revoking an enforcement order, the CMA must publish the notice.

s.34(5)

The CMA may consult such persons as the CMA considers appropriate on any proposal to revoke an enforcement order.

s.35

Duty to keep enforcement orders under review

The CMA must keep under review—

s.35(a)

the extent to which an undertaking to which it has given an enforcement order is complying with that order,

s.35(b)

the effectiveness of an enforcement order,

s.35(c)

whether to vary or revoke an enforcement order,

s.35(d)

where an enforcement order is revoked, whether to make a new enforcement order, and

s.35(e)

whether to take action in accordance with Chapter 7 (enforcement and appeals) in respect of an undertaking which does not comply with an enforcement order.

Pt.1 Ch.3(crossheading)(commitments)(relating)(to)(conduct)(requirements)

Commitments relating to conduct requirements

s.36

Commitments

s.36(1)

The CMA may accept an appropriate commitment from an undertaking subject to a conduct investigation as to its behaviour in respect of a conduct requirement to which the investigation relates.

s.36(2)

A commitment is appropriate where the CMA considers that compliance with the commitment by the undertaking would mean that it would not be necessary to carry out a conduct investigation so far as relating to the behaviour to which the commitment relates.

s.36(3)

Following the acceptance of a commitment by the CMA as to the behaviour of an undertaking—

s.36(3)(a)

the undertaking that gave the commitment must comply with it at all times when it is in force, and

s.36(3)(b)

so far as relating to the behaviour, the CMA may not give a notice to the undertaking under section 30 (notice of findings).

s.36(4)

The acceptance of a commitment does not prevent—

s.36(4)(a)

a conduct investigation from continuing so far as it relates to other behaviour in relation to the same or a different conduct requirement, or

s.36(4)(b)

the CMA beginning a new conduct investigation in relation to the behaviour to which the commitment relates where—

s.36(4)(b)(i)

it has reasonable grounds to believe that there has been a material change of circumstances since the commitment was accepted,

s.36(4)(b)(ii)

it has reasonable grounds to suspect that the undertaking has not complied with one or more of the terms of the commitment, or

s.36(4)(b)(iii)

it has reasonable grounds to suspect that information which led it to accept the commitment was incomplete, false or misleading in a material particular.

s.36(5)

A commitment under this section comes into force when a notice of its acceptance is published by the CMA.

s.36(6)

A commitment under this section ceases to have effect—

s.36(6)(a)

subject to provision made in reliance on section 17 (existing obligations)—

s.36(6)(a)(i)

in accordance with any terms of the commitment about when it is to cease to have effect, or

s.36(6)(a)(ii)

when the conduct requirement to which the commitment relates ceases to have effect, or

s.36(6)(b)

when the undertaking is released from the requirement to comply with the commitment.

s.36(7)

The CMA may by notice accept a variation to a commitment from time to time provided the commitment as varied would still be appropriate.

s.36(8)

The CMA may release an undertaking from the requirement to comply with a commitment where it considers that it would be appropriate to do so.

s.36(9)

The fact that a commitment ceases to have effect does not affect the exercise of any functions in relation to a breach or possible breach of that commitment.

s.36(10)

Schedule 1 makes provision about— for the purposes of this Chapter and Chapter 4 (pro-competition orders).

s.36(10)(a)

accepting, or accepting a variation of, a commitment, and

s.36(10)(b)

releasing an undertaking from the requirement to comply with a commitment,

s.37

Duty to keep commitments under review

The CMA must keep under review—

s.37(a)

the appropriateness of a commitment or releasing an undertaking from a commitment,

s.37(b)

the extent to which an undertaking which has given a commitment is complying with it, and

s.37(c)

the appropriateness of taking further action in accordance with Chapter 7 (enforcement and appeals) in respect of an undertaking which does not comply with a commitment which it has given.

Pt.1 Ch.3(crossheading)(final)(offer)(mechanism)

Final offer mechanism

s.38

Power to adopt final offer mechanism

s.38(1)

Where the CMA considers that the following three conditions are met in relation to a transaction between a designated undertaking and a third party, the CMA may— to submit to the CMA terms as to payment (“final offer payment terms”) which the undertaking or, as the case may be, the third party regards as fair and reasonable for the transaction.

s.38(1)(a)

require the undertaking, and

s.38(1)(b)

invite the third party,

s.38(2)

The first condition is that the transaction is a transaction in which the designated undertaking would—

s.38(2)(a)

provide goods or services to the third party, or

s.38(2)(b)

acquire goods or services from, or use goods or services of, the third party.

s.38(3)

The second condition is that, by failing to agree fair and reasonable terms as to payment for the transaction, the designated undertaking has breached an enforcement order, other than an interim enforcement order, made in relation to a breach of a conduct requirement of the type permitted by section 20(2)(a) (requirement to trade on fair and reasonable terms).

s.38(4)

The third condition is that the CMA could not satisfactorily address the breach within a reasonable time frame by exercising any of its other digital markets functions.

s.38(5)

In subsection (1), “transaction” means— whether in accordance with a contract or otherwise.

s.38(5)(a)

a future transaction, or

s.38(5)(b)

the future performance of an ongoing transaction,

s.38(6)

In sections 39 to 44—

s.39

Collective submissions

s.39(1)

Where the CMA considers that— the CMA may exercise the power in section 38(1) to invite the third parties (the “joined third parties”) to make a single submission to the CMA of final offer payment terms that the joined third parties collectively regard as fair and reasonable for the transaction.

s.39(1)(a)

the conditions in section 38(2), (3) and (4) are met in relation to a single transaction between the designated undertaking and two or more third parties, and

s.39(1)(b)

the third parties are capable of acting jointly in relation to final offer payment terms relating to the transaction,

s.39(2)

Where the CMA proceeds in reliance on subsection (1), sections 40 to 44 apply as if—

s.39(2)(a)

in section 40(8) references to “the third party” were to any one or more of the joined third parties;

s.39(2)(b)

all other references to “the third party” were to the joined third parties.

s.39(3)

Where the CMA considers that— the CMA may exercise the power in section 38(1) to invite the third parties (the “grouped third parties”) to make a single submission to the CMA of final offer payment terms that the grouped third parties collectively regard as fair and reasonable for the transactions (the “grouped transactions”).

s.39(3)(a)

the conditions in section 38(2), (3) and (4) are met in relation to two or more transactions between the designated undertaking and two or more third parties,

s.39(3)(b)

the same terms as to payment are capable of applying to the transactions, and

s.39(3)(c)

the third parties are capable of acting jointly in relation to final offer payment terms relating to the transactions,

s.39(4)

Where the CMA proceeds in reliance on subsection (3), sections 40 to 44 apply as if—

s.39(4)(a)

in the following provisions, references to “the third party” were to any one or more of the grouped third parties—

s.39(4)(a)(i)

section 40(8);

s.39(4)(a)(ii)

section 41(2)(b);

s.39(4)(a)(iii)

section 42(1)(b);

s.39(4)(a)(iv)

section 43(2);

s.39(4)(b)

all other references to “the third party” were to the grouped third parties;

s.39(4)(c)

in section 43(1) and (2), the reference to “the transaction” were to any one or more of the grouped transactions;

s.39(4)(d)

all other references to “the transaction” were to the grouped transactions.

s.40

Final offer mechanism

s.40(1)

The power conferred by section 38(1) is to be exercised by giving a notice (a “final offer initiation notice”) to the designated undertaking and the third party.

s.40(2)

The final offer initiation notice must—

s.40(2)(a)

specify the designated undertaking, the third party and the digital activity in respect of which the power is being exercised;

s.40(2)(b)

describe the breach of the enforcement order in relation to which the second condition in section 38 is met;

s.40(2)(c)

summarise the transaction;

s.40(2)(d)

specify a date (the “submission date”) on or before which final offer payment terms are to be submitted to the CMA;

s.40(2)(e)

state the period by the end of which the CMA must make any final offer order (see section 41(3));

s.40(2)(f)

state the circumstances in which that period may be extended (see section 104).

s.40(3)

As soon as reasonably practicable after giving a final offer initiation notice, the CMA must publish a statement which—

s.40(3)(a)

includes the information mentioned in subsection (2), and

s.40(3)(b)

if the CMA is considering taking any other action relating to any underlying cause of the breach of the enforcement order, includes a summary of, and explanation for considering, that action.

s.40(4)

After giving a final offer initiation notice, the CMA may—

s.40(4)(a)

change its view of the transaction or the third party, provided that the new transaction or third party remains substantially the same as the previous transaction or third party,

s.40(4)(b)

revise any list of joined third parties or grouped third parties, or

s.40(4)(c)

change the submission date.

s.40(5)

The powers conferred by subsection (4) are to be exercised by giving a revised version of the final offer initiation notice to the designated undertaking and the third party.

s.40(6)

Where the power conferred by subsection (4)(b) is being exercised, the reference in subsection (5) to “the third party” includes each person that was a joined third party or a grouped third party prior to the exercise of the power or that is to be a joined third party or a grouped third party after the exercise of the power.

s.40(7)

As soon as reasonably practicable after giving a revised version of a final offer initiation notice, the CMA must publish a statement summarising the contents of the revised notice.

s.40(8)

To facilitate the submission of final offer payment terms, the CMA may (among other things)—

s.40(8)(a)

use an information notice to require that the designated undertaking or the third party give information to the CMA (see section 69);

s.40(8)(b)

share information between the designated undertaking and the third party in accordance with section 241 of EA 2002 (statutory functions);

s.40(8)(c)

specify the form or manner in which final offer payment terms must be submitted.

s.41

Final offers: outcome

s.41(1)

This section applies where—

s.41(1)(a)

the CMA has exercised its power under section 38(1), and

s.41(1)(b)

either—

s.41(1)(b)(i)

the CMA has received final offer payment terms from both the designated undertaking and the third party, or

s.41(1)(b)(ii)

the CMA has received final offer payment terms from either the designated undertaking or the third party (but not both), and the submission date has passed.

s.41(2)

The CMA must, unless section 43(1) applies, make an order (a “final offer order”) requiring that final offer payment terms it has received from the designated undertaking or the third party are to be given effect for the purposes of—

s.41(2)(a)

the transaction, and

s.41(2)(b)

any transaction between the designated undertaking and the third party which is substantially the same as the transaction.

s.41(3)

The CMA must comply with subsection (2) on or before the last day of the period (the “final offer period”) of 6 months beginning with the day on which the final offer initiation notice is given to the designated undertaking and the third party.

s.41(4)

The Secretary of State may by regulations amend this section so as to modify the length of the final offer period.

s.41(5)

Regulations under subsection (4) are subject to the affirmative procedure.

s.42

Final offer orders: supplementary

s.42(1)

A final offer order must impose on the designated undertaking such obligations as the CMA considers appropriate for the purpose of—

s.42(1)(a)

securing compliance with the requirement imposed by virtue of section 41(2), and

s.42(1)(b)

preventing the designated undertaking from making an agreement with the third party which conflicts with that requirement.

s.42(2)

At the same time as making a final offer order, the CMA must give the designated undertaking and the third party a notice—

s.42(2)(a)

summarising the transaction,

s.42(2)(b)

including the reasons for the order, and

s.42(2)(c)

enclosing a copy of the order.

s.42(3)

As soon as reasonably practicable after making a final offer order, the CMA must publish a statement summarising the contents of the final offer order and the notice given under subsection (2).

s.43

Decision not to make final offer order

s.43(1)

The CMA may decide not to make a final offer order in relation to the transaction where it has reasonable grounds to believe that there has been a material change of circumstances since the final offer initiation notice was given.

s.43(2)

For the purposes of this section and section 44(3) a material change of circumstances includes an agreement between the designated undertaking and the third party with respect to terms as to payment in relation to the transaction.

s.43(3)

Where the CMA decides not to make a final offer order, it must give a notice to that effect to the designated undertaking and the third party.

s.43(4)

The notice must include the reasonable grounds referred to in subsection (1).

s.43(5)

As soon as reasonably practicable after giving a notice under subsection (3), the CMA must publish a statement summarising the contents of the notice.

s.44

Duration and revocation of final offer orders

s.44(1)

A final offer order comes into force at such time as the CMA may specify in the order.

s.44(2)

A final offer order ceases to have effect—

s.44(2)(a)

when revoked under this section, or

s.44(2)(b)

subject to provision made in reliance on section 17 (existing obligations), when the designation to which it relates ceases to have effect.

s.44(3)

The CMA may revoke, or partially revoke, a final offer order where it has reasonable grounds to believe that there has been a material change of circumstances since the final offer order was made.

s.44(4)

Where the CMA decides to revoke, or partially revoke, a final offer order, it must give a notice to that effect to the designated undertaking and the third party.

s.44(5)

The notice must include the reasons for the CMA’s decision.

s.44(6)

The notice may include transitional, transitory or saving provision in relation to the revocation, or partial revocation, of the final offer order.

s.44(7)

As soon as reasonably practicable after revoking, or partially revoking, a final offer order, the CMA must publish a statement summarising the contents of the notice revoking, or partially revoking, the order.

s.44(8)

The fact that a final offer order ceases to have effect does not affect the exercise of any digital markets functions in relation to a breach or possible breach of that order.

s.45

Duty to keep final offer orders under review

The CMA must keep under review—

s.45(a)

the extent to which an undertaking to which it has given a final offer order is complying with that order,

s.45(b)

the effectiveness of the final offer order,

s.45(c)

whether to revoke the final offer order, and

s.45(d)

whether to take action in accordance with Chapter 7 (enforcement and appeals) in respect of an undertaking which does not comply with a final offer order.

Pt.1 Ch.4

Pro-competition interventions

s.46

Power to make pro-competition interventions

s.46(1)

The CMA may make a pro-competition intervention (a “PCI”) in relation to a designated undertaking where, following a PCI investigation (see section 47), the CMA considers that—

s.46(1)(a)

a factor or combination of factors relating to a relevant digital activity is having an adverse effect on competition, and

s.46(1)(b)

it would be proportionate to make the PCI for the purposes of remedying, mitigating or preventing the adverse effect on competition.

s.46(2)

In considering whether to make a PCI, and the form and content of any PCI, the CMA may have regard to any benefits to UK users or UK customers that the CMA considers have resulted, or may be expected to result, from a factor or combination of factors that is having an adverse effect on competition.

s.46(3)

A PCI may take the form of one or both of the following—

s.46(3)(a)

an order imposing on the designated undertaking requirements as to how the undertaking must conduct itself, in relation to the relevant digital activity or otherwise (a “pro-competition order”: see section 51);

s.46(3)(b)

recommendations made by the CMA to any person exercising functions of a public nature about steps which the CMA considers the person ought to take in respect of the designated undertaking or the digital activity, or otherwise.

s.46(4)

A PCI may include provision for the purposes of remedying, mitigating or preventing any detrimental effect on UK users or UK customers that the CMA considers has resulted, or may be expected to result, from the adverse effect on competition to which the PCI relates.

s.46(5)

A factor or combination of factors relating to a digital activity has an adverse effect on competition where it prevents, restricts or distorts competition in connection with the relevant digital activity in the United Kingdom.

s.47

Power to begin a PCI investigation etc

s.47(1)

The CMA may begin an investigation (a “PCI investigation”) in relation to a designated undertaking where it has reasonable grounds to consider that a factor or combination of factors relating to a relevant digital activity may be having an adverse effect on competition.

s.47(2)

A PCI investigation is an investigation to enable the CMA to determine—

s.47(2)(a)

whether to make a PCI, and

s.47(2)(b)

if it concludes that it should make a PCI, the form and content of that PCI.

s.47(3)

The CMA may begin a PCI investigation in relation to a designated undertaking even if it has previously made a decision not to make a PCI in respect of that undertaking.

s.48

Procedure relating to PCI investigations

s.48(1)

Where the CMA begins a PCI investigation it must give the designated undertaking to which the investigation relates a notice (a “PCI investigation notice”).

s.48(2)

The PCI investigation notice must state—

s.48(2)(a)

the reasonable grounds mentioned in section 47(1);

s.48(2)(b)

the purpose and scope of the PCI investigation;

s.48(2)(c)

the period by the end of which the CMA must give the undertaking a notice setting out its decision as a result of the investigation (see section 50(1));

s.48(2)(d)

the circumstances in which that period may be extended (see section 104).

s.48(3)

The CMA may give the undertaking one or more revised versions of the PCI investigation notice if it changes its view of the purpose and scope of the investigation, provided that the purpose and scope of the investigation remains substantially the same.

s.48(4)

As soon as reasonably practicable after giving a PCI investigation notice or a revised version of the PCI investigation notice, the CMA must publish the notice or the revised version of the notice.

s.49

Consultation on proposed PCI decision

s.49(1)

Before making a final decision (a “PCI decision”) on whether to make a PCI as a result of a PCI investigation, the CMA must—

s.49(1)(a)

carry out a public consultation on its proposed decision, and

s.49(1)(b)

bring the public consultation to the attention of such persons as it considers appropriate.

s.49(2)

For the purposes of the consultation the CMA must publish a statement setting out—

s.49(2)(a)

the CMA’s findings as a result of the investigation, and

s.49(2)(b)

a description of any PCI which the CMA is considering making.

s.50

PCI decision

s.50(1)

The CMA must give the designated undertaking to which a PCI investigation relates a notice of the PCI decision resulting from the investigation on or before the last day of the period (the “PCI investigation period”) of 9 months beginning with the day on which the PCI investigation notice is given to the undertaking.

s.50(2)

The notice must—

s.50(2)(a)

state the CMA’s findings as a result of the PCI investigation,

s.50(2)(b)

describe any PCI which the CMA intends to make, and

s.50(2)(c)

include reasons for the CMA’s findings and decision.

s.50(3)

The giving of a revised version of the PCI investigation notice under section 48(3) does not change the day on which the PCI investigation period begins.

s.50(4)

The CMA must make any PCI within the period of 4 months beginning with the day on which the CMA gives the notice under subsection (1).

s.50(5)

The CMA may extend the period mentioned in subsection (4) by up to 2 months where it considers that there are special reasons for doing so.

s.50(6)

Where the CMA decides not to make a PCI having previously indicated in a notice under subsection (1) that it intended to make a PCI, the CMA must give the undertaking a further notice—

s.50(6)(a)

stating the CMA’s decision, and

s.50(6)(b)

including reasons for the decision.

s.50(7)

As soon as reasonably practicable after giving a notice under subsection (1) or (6), the CMA must publish a copy of the notice.

s.51

Pro-competition orders

s.51(1)

A pro-competition order may include any provision that may be included in an enforcement order under section 161 of EA 2002 (final orders following market investigation references; and see section 164 of and Schedule 8 to EA 2002 on the provision that may be included).

s.51(2)

For the purposes of subsection (1), Schedule 8 to EA 2002 (provision that may be contained in certain enforcement orders) has effect as if—

s.51(2)(a)

the reference in paragraph 8(2) to “the relevant report” were to the notice under section 50(1) of this Act;

s.51(2)(b)

paragraphs 20A to 20BA were omitted.

s.51(3)

A pro-competition order may include provision imposing requirements on an undertaking on a trial basis for the purpose of assisting the CMA in establishing requirements that would be effective in remedying, mitigating or preventing—

s.51(3)(a)

the adverse effect on competition to which the order relates;

s.51(3)(b)

any detrimental effect on UK users or UK customers resulting from, or expected to result from, the adverse effect on competition.

s.51(4)

The provision that may be made in reliance on subsection (3) includes provision requiring an undertaking to act differently in respect of different users or customers (and such provision may be by reference to a description of users or customers, to absolute numbers of users or customers, or to a proportion of the undertaking’s total number of users or customers).

s.51(5)

A pro-competition order must contain provision in accordance with section 55(3) (duty to ensure order contains date of next review).

s.51(6)

As soon as reasonably practicable after making a pro-competition order, the CMA must publish the order.

s.52

Replacement of pro-competition orders

s.52(1)

The CMA may, by making a further pro-competition order, replace a pro-competition order where it considers that it is appropriate to do so, having regard in particular to—

s.52(1)(a)

the effectiveness of the pro-competition order, or of particular provisions in the pro-competition order, in remedying, mitigating or preventing the adverse effect on competition and, where applicable, any detrimental effect on UK users or UK customers identified in the PCI investigation, and

s.52(1)(b)

any change of circumstances since the pro-competition order was made.

s.52(2)

The CMA may, in particular, replace a pro-competition order so as to—

s.52(2)(a)

replace requirements imposed by virtue of that order on a trial basis, or

s.52(2)(b)

impose requirements on an undertaking that are similar to or informed by one or more requirements previously imposed on that undertaking, or on a different undertaking, by virtue of another pro-competition order on a trial basis.

s.52(3)

In this Chapter—

s.52(3)(a)

references to making a replacement order are to revoking a pro-competition order (see section 53) made following a PCI investigation and making a new pro-competition order in reliance on the findings of that PCI investigation, and

s.52(3)(b)

references to a “replacement order” are to a pro-competition order made in reliance on subsection (1).

s.53

Duration and revocation etc of pro-competition orders

s.53(1)

A pro-competition order comes into force at such time as the CMA may specify in the order.

s.53(2)

A pro-competition order ceases to have effect—

s.53(2)(a)

when revoked under this section, or

s.53(2)(b)

subject to provision made in reliance on section 17 (existing obligations), when the designation to which it relates ceases to have effect.

s.53(3)

The CMA may revoke a pro-competition order where it considers that it is appropriate to do so, having regard in particular to any change of circumstances since the pro-competition order was made.

s.53(4)

Where the CMA decides to revoke a pro-competition order, it must give a notice to that effect to the designated undertaking to which the order relates.

s.53(5)

The notice may include transitional, transitory or saving provision in relation to the revocation of the pro-competition order.

s.53(6)

The CMA must publish the notice as soon as reasonably practicable after giving it.

s.53(7)

Where a pro-competition order resulting from a PCI investigation is revoked without being replaced, the CMA may not make a new pro-competition order in reliance on the same PCI investigation.

s.53(8)

The fact that a pro-competition order ceases to have effect does not affect the exercise of any functions in relation to a breach or possible breach of that order.

s.54

Consultation

s.54(1)

The CMA must carry out a public consultation on the terms of any pro-competition order before making it (subject to subsection (4)).

s.54(2)

The duty to consult imposed by subsection (1) may be satisfied by consultation on a proposed PCI decision in a case where—

s.54(2)(a)

a draft pro-competition order was published for the purposes of that consultation, and

s.54(2)(b)

the CMA proposes to make a pro-competition order that is the same or materially the same as the draft pro-competition order.

s.54(3)

Before revoking a pro-competition order, the CMA must (subject to subsection (4))—

s.54(3)(a)

carry out a public consultation on the proposed revocation, and

s.54(3)(b)

bring the public consultation to the attention of such persons as it considers appropriate.

s.54(4)

The duties in subsections (1) and (3) do not apply in relation to the making of a replacement order which, in the opinion of the CMA, is not materially different from the order which it replaces.

s.55

Duty to review pro-competition orders etc

s.55(1)

The CMA must carry out a review of a pro-competition order, including a replacement order, to determine whether to—

s.55(1)(a)

revoke it without making a replacement order, or

s.55(1)(b)

make a replacement order.

s.55(2)

Each time the CMA makes a pro-competition order, including a replacement order, it must identify a date by which it will carry out the review under subsection (1).

s.55(3)

The CMA must secure that the date is specified in the order.

s.55(4)

The CMA must keep under review—

s.55(4)(a)

the effectiveness of a pro-competition order;

s.55(4)(b)

the extent to which an undertaking subject to a pro-competition order is complying with it;

s.55(4)(c)

whether to take action in accordance with Chapter 7 (enforcement and appeals) in respect of any undertaking that breaches a pro-competition order.

s.56

Commitments

s.56(1)

The CMA may accept an appropriate commitment from a designated undertaking as to its conduct in respect of an adverse effect on competition or a detrimental effect on UK users or UK customers that the CMA considers has resulted, or may be expected to result, from an adverse effect on competition.

s.56(2)

A commitment is appropriate where the CMA considers that compliance with the commitment by the undertaking would contribute to or otherwise be of use in remedying, mitigating or preventing—

s.56(2)(a)

the adverse effect on competition, or

s.56(2)(b)

the detrimental effect on UK users or UK customers.

s.56(3)

Following the acceptance of a commitment by the CMA as to the conduct of an undertaking—

s.56(3)(a)

the undertaking that gave the commitment must comply with it at all times when it is in force, and

s.56(3)(b)

so far as relating to the conduct, the CMA may give a notice to the undertaking—

s.56(3)(b)(i)

ending a PCI investigation (if it has begun one) without making a PCI decision, or

s.56(3)(b)(ii)

changing the scope of a PCI investigation.

s.56(4)

As soon as reasonably practicable after giving a notice under subsection (3)(b), the CMA must publish a statement summarising the contents of the notice.

s.56(5)

The acceptance of a commitment does not prevent—

s.56(5)(a)

a PCI investigation from continuing so far as it relates to conduct other than that to which the commitment relates, or

s.56(5)(b)

the CMA beginning a new PCI investigation in relation to the conduct to which the commitment relates where it has reasonable grounds—

s.56(5)(b)(i)

to believe that there has been a material change of circumstances since the commitment was accepted,

s.56(5)(b)(ii)

to suspect that the undertaking has not complied with one or more of the terms of the commitment, or

s.56(5)(b)(iii)

to suspect that information which led it to accept the commitment was incomplete, false or misleading in a material particular.

s.56(6)

A commitment under this section comes into force when a notice of its acceptance is published by the CMA.

s.56(7)

A commitment under this section ceases to have effect—

s.56(7)(a)

subject to provision made in reliance on section 17 (existing obligations)—

s.56(7)(a)(i)

in accordance with any terms of the commitment about when it is to cease to have effect, or

s.56(7)(a)(ii)

when the designation to which the commitment relates ceases to have effect, or

s.56(7)(b)

when the undertaking is released from the requirement to comply with the commitment.

s.56(8)

The following provisions apply in relation to commitments under this section as they apply in relation to commitments under section 36—

s.56(8)(a)

subsections (7) to (10) of section 36;

s.56(8)(b)

section 37.

Pt.1 Ch.5

Mergers

s.57

Duty to report possible mergers etc

s.57(1)

A relevant person (in this Chapter, “P”) must report an event to which subsection (2) or (3) applies (a “reportable event”) to the CMA before the event takes place.

s.57(2)

This subsection applies to an event where—