The framework for competition was set out in the Water Industry Act 1991 and the scope was
extended by the Competition and Services (Utilities
) Act 1992. The Competition Act 1998 came into force on 1 March 2000.
Timing of the Competition Act and main features
The date of implementation was 1 March 2000.
The act introduces two key prohibitions:
- agreements that restrict, distort or prevent competition
- abuse of a dominant position
The Act covers all industry and applies to Scotland and Wales.
One key feature of the act is that it looks at the effect of an activity or agreement not
the intent. This is important as it can be exceedingly difficult to prove, in law, the intent.
Where anti competitive action is suspected a direction to end the infringement can be made.
In addition penalties (up to 10% of UK turnover) can be imposed.
Ofwat, the Office of fair trading (OFT) and other sector regulators concurrently enforce and apply the Competition Act