On 2 March 2011, the OFT published its final Guidance on the processes and procedures it will follow when undertaking Chapter I and Chapter II investigations under the Competition Act 1998. The Guidance takes into account responses received during the consultation process in the autumn of last year.
The Guidance is a welcome and comprehensive overview of the investigations process, from receiving a complaint to opening an investigation and on to the final decision. It reinforces the OFT’s continued commitment to a more transparent and pragmatic approach to its enforcement functions, focusing its attention and resources where they are most needed. A recent example in practice was the OFT’s approach to and resolution of the investigation into an information sharing tool in the motor insurance sector which was resolved via commitments by the parties within 12 months of opening the investigation.
Whilst the Guidance clearly builds on the OFT’s enforcement experience over the past 10 years, the following three points are notable innovations:
A commitment to decide within four months of receiving a written complaint whether to open a formal investigation. To assist potential complainants in deciding whether to proceed with the preparation of a formal written complaint, the OFT is offering the possibility of engaging in pre-complaint discussions
Increased use of draft information requests and advanced notice of large written information requests to enable parties to engage on appropriate deadlines. The quid pro quo of such transparency will be a firmer commitment to adhere to the timetable in all but exceptional cases
The introduction of a trial new role in the form of a ‘Procedural Adjudicator’ to resolve disputes swiftly in relation to certain case team procedural decisions
Where parties have a complaint about a particular procedural issue, they are invited in the first instance to raise the issue with the Senior Responsible Officer (this will be a senior OFT official with overall responsibility for delivery of the case, including in most cases responsibility for taking the final decision). Where they are unhappy with the SRO’s decision, the parties will have five working days to request a review by the Procedural Adjudicator, who will be independent of the case team. The Procedural Adjudicator will give each side the opportunity to put views orally by telephone or in a meeting and will have an administrative target of reaching a decision within ten working days. The Procedural Adjudicator will not review decisions on substance or on the scope of the information request, but can review decisions such as:
- Confidentiality redactions
- Disclosure or non-disclosure of documents at the access to file stage
- Procedural issues relating to oral representation meetings
The Procedural Adjudicator trial will commence on 21 March and will initially last 12 months, although it may be extended if the OFT feels that it has insufficient data at the end of that period to make a decision on its utility going forwards. Further guidance on the process to be followed by the Procedural Adjudicator will be published in due course.
Publication of this Guidance represents another welcome step in the OFT’s continued attempts to adopt a transparent, pragmatic and above all efficient approach to its enforcement activities. The ability to engage in pre-complaint discussions and the commitment by the OFT to reach a decision on whether to open a formal investigation within four months of receiving a formal complaint will be particularly welcome to potential complainants.
The introduction of an independent role with the power to adjudicate and decide on procedural issues within a very short time-frame and the commitment to use draft information requests and advance notice of large information requests wherever appropriate are also very welcome developments, which we very much hope to see replicated in the practices of the concurrent regulators.