CMA approach to business cooperation in response to COVID-19

March 30, 2020

On the 25th March, the CMA published a paper outlining its approach to business cooperation in response to covid-19.

The paper confirmed the CMA’s focus for the next few months. The CMA will be protecting UK consumers from the adverse consequences of the COVID-19 pandemic to the greatest extent possible.

The CMA is conscious of concerns that competition law enforcement could impede necessary cooperation between businesses to deal with the current crisis and ensure security of supplies of essential products and services.

Competition typically benefits consumers by spurring businesses to offer lower prices, better service and higher quality. Competition law exists to make sure that businesses do not limit competition to the detriment of consumers. For example, there is a prohibition in competition law on agreements and arrangements between businesses that restrict competition.

This prohibits businesses from colluding or cooperating to limit competition – for example by agreeing to increase prices or to divide up markets or customers amongst themselves.

Throughout the UK, businesses are assisting in national and local efforts to tackle the consequences of the COVID-19 pandemic, from providing essential goods and services to consumers, to ensuring key workers can carry out their important tasks in getting the country through this crisis.

The CMA understands that this may involve coordination between competing businesses. and wants to provide reassurance that, provided that any such coordination is undertaken solely to address concerns arising from the current crisis and does not go further or last longer than what is necessary, the CMA will not take action against it.

The full paper can be read below.

https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/875468/COVID-19_guidance_-.pdf