Hong Kong’s proposed competition law is expected to be enacted by July 2012. Its main features are likely to be:
- standard prohibitions on (i) restrictive agreements and concerted practices (first conduct rule) and (ii) abuse of a substantial degree of market power (second conduct rule)
- a judicial enforcement model, with sanctions only being applied by a Competition Tribunal
- broad exclusions, including for merger activities and for statutory bodies.
A Norton Rose Group briefing on the Hong Kong proposals may be viewed at http://www.nortonrose.com/knowledge/ publications/64447/the-hong-kongcompetition- bill.
The Competition Act finally came into force in January 2012. One of the first investigations of the new Malaysian Competition Commission relates to the aviation industry.
In March 2012, the UK Government, following an extensive consultation process, published its proposals for changes to the UK competition system, particularly as regards procedures and institutions. Key proposals (in addition to those on merger control discussed in the M&A section above) include:
- Criminal offence: The criteria for the cartel criminal offence will be changed to avoid the need to prove an individual has acted “dishonestly”, making it easier to convict directors, managers or employees personally involved in serious anticompetitive arrangements.
- For market investigations, shorter time limits are being introduced, including a maximum one year for the “Phase 1” market study, and normally a maximum 18 months for the full “Phase 2” market investigation.
- For enforcement of the prohibitions on anti-competitive agreements and abuse of dominance, there will be a certain degree of separation of powers between the investigating team and the decisionmaking team, to avoid concerns about confirmation bias. The UK Government has rejected more radical change, such as moving to a US-style prosecutorial system.
- UK competition authorities: The Office of Fair Trading (OFT) and the Competition Commission are to be amalgamated into a single unitary body, the Competition and Markets Authority (CMA), although in merger and market cases there will be separate teams within the CMA for Phase 1 and Phase 2.
- The sector regulators (ie, the regulators of the energy, water, telecoms and rail sectors) will retain their powers to apply competition law in their sectors, concurrently with the competition authorities’ powers. The sector regulators will also be subject to a new obligation to consider competition law remedies before regulatory remedies where there are competition concerns.
More details on this are available in our Norton Rose Group briefing on this, which may be viewed at http://www.nortonrose. com/knowledge/publications/64732/ uk-competition-law-reforms-announced.