DBT's consultation on Refining our Competition Regime

Which? supports the government’s ambition for the UK to have an international ‘best in class’ competition regime. We believe the consultation contains some proposals that could bring improvements to the mergers and markets regimes, which would benefit businesses and ultimately UK consumers. However, we feel there is a lack of evidence supporting the arguments for several of the proposals and, overall, we feel the consultation fails to make a persuasive case that the proposals will make fundamental improvements to the competition regime as a whole.

In brief:

• The stated rationale for reforming CMA decision-making by abolishing the Panel and placing more duties on the Board are flawed. The government has not sufficiently considered the potential for unintended consequences.
• The proposals to the markets regime have clearer benefits, but we would like to understand how the government intends to mitigate potential risks from moving to a single-phase market review tool. 
• With regard to mergers, we support the extension of the timeframe for submitting and considering Phase 1 undertakings, but are unconvinced that changes relating to the jurisdictional tests are needed.
• We strongly support the CMA being given enhanced powers to investigate algorithms in its competition and consumer protection functions.

We oppose the Secretary of State having a formal role in a wider range of key guidance documents. No objective observer of the CMA since January 2025 could make the case that it lacks political accountability. Giving the Secretary of State a greater role in approving operational guidance invites businesses to lobby Ministers to change CMA guidance rather than arguing their case on the merits of competition law. It is unclear how this change will make the CMA faster and more effective.

Which? believes there are some improvements that could be made with a careful redesign of elements of the competition regime, but we encourage the government to explore more deeply the trade offs at stake and to do more to demonstrate that the changes will have benefits for UK consumers and their trust in markets and competition.