In December 2024, the CMA published the findings of its review of the effectiveness of the UK’s competition concurrency arrangements (the Report). Under these arrangements, the CMA and the UK's sector regulators share certain competition enforcement powers, which are aimed at promoting competition in the regulated sectors. In this article, we explore the key takeaways and recommendations from the Report, and what they mean for the future.

Background
The UK’s concurrency arrangements allow the CMA and the sector regulators1 to use their competition powers in the regulated sectors on a shared basis. Within their respective sectors, the regulators have a duty to promote competition, and the power to: (i) enforce the provisions of the Competition Act 1998 (CA98) relating to anti-competitive agreements and abuses of dominance; (ii) conduct market studies under the Enterprise Act 2002 (EA02); and (iii) make market investigation references (MIRs) to the CMA. The CMA retains exclusive responsibility for merger control, including in the regulated sectors2.

The Enterprise and Regulatory Reform Act 2013 introduced various enhancements, with a view to improving use of the powers and enhancing co-ordination between the sector regulators and the CMA. The reforms took effect in 2014 and included:

the introduction of a “primacy obligation”, which means that sector regulators must consider whether it would be more appropriate to remedy competition law issues in a given sector using enforcement powers before taking regulatory action;
imposing legal requirements on the CMA and the sector regulators to consult each other on the exercise of their concurrent powers, especially as regards CA98 enforcement;
an ability for the CMA to require the transfer of CA98 enforcement cases from the sector regulators; and
establishing the UK Competition Network (UKCN) to create a forum for engagement and discussion between the sector regulators and the CMA. 
The FCA (and PSR) also received concurrent enforcement powers shortly after these reforms, and a statutory objective of promoting competition.

With a decade having passed since the introduction of these reforms, the CMA has taken stock and, in August 2023, launched a review into the overall operation and effectiveness of the concurrency regime. The resulting Report considers: (i) whether concurrency is the correct enforcement model; and (ii) what scope there is to improve the concurrency arrangements.

The Report’s findings
Concurrency as a model

The majority of stakeholders that engaged in the CMA’s review were supportive of concurrency. Whilst a small number considered it to be less effective at promoting competition in the regulated sectors than exclusive CMA enforcement, overall the CMA considered there to be stronger arguments to suggest that concurrency supports “more and more effective enforcement”.

The CMA considered that the following features supported this conclusion: the sharing of complementary skills and knowledge; additional capacity and coverage in the competition regime; and improved detection and case selection. The Report is, nevertheless, nuanced in acknowledging that there are some factors that may discourage sector regulators from exercising their concurrent powers, and in recognising that there is scope for improvement.

Scope for improvement

The second section of the Report separately considers specific improvements, across three themes:

the sector regulators’ capacity for the exercise of their concurrent powers;
the priority that sector regulators give to CA98 enforcement; and
cooperation between sector regulators and the CMA on markets work.
1. Capacity
2. Priority given to CA98 enforcement
3. Cooperation on markets work
Commentary
Whilst the Report identifies certain growing pains and a need amongst the sector regulators for more resources and transparency, there is no suggestion that a wholesale overhaul of the concurrency regime is warranted. Indeed, the CMA concludes that “on balance, competition in the regulated sectors is being promoted more effectively than it would be under an alternative model”. We can, therefore, expect more of the same from the CMA and concurrent sector regulators, albeit with greater communication and cooperation between them.

As to whether the Report’s recommendations will lead to more enforcement, only time will tell. Inter-regulator secondments may not be enough to address deficiencies in enforcement capacity and/or expertise. And even regulators such as the FCA, with large, dedicated competition enforcement teams, have not successfully concluded many cases (two in a nearly 10-year period in the FCA’s case)4. A tendency to prioritise regulatory action persists despite regulators long having been obliged to first consider using CA98 enforcement. It remains to be seen whether advocacy by the CMA will be sufficient to address this reticence.
 

1 Specifically, the: Civil Aviation Authority; Financial Conduct Authority (FCA); Gas and Electricity Markets Authority (Ofgem); Office of Communications (Ofcom); Office of Rail and Road (ORR); Payment Systems Regulator (PSR); Northern Ireland Authority for Utility Regulation; and Water Services Regulation Authority.

2 In certain sectors (namely water and energy), the CMA has an obligation to consult the relevant regulators. In the others, the regulators will usually provide their views on a merger to the CMA.

3 Sector regulators may also, under their sectoral powers, carry out “market reviews” which may be similar in practice to market studies.

4 More broadly, the Report notes that concurrent enforcement substantially increased following the 2014 reforms. In the decade preceding the reforms, only two infringement decisions were issued by sector regulators. In the subsequent decade, eight were issued. Some might still question whether this remains too low: the CMA issued 40 infringement decisions in the same period (including two in the regulated sectors), and the regulated sectors are estimated to account for around a quarter of UK GDP.