Competition and Markets Authority

Businesses must review the Green Claims Code and accompanying guidance to determine whether their environmental claims are in compliance.

By David Little and Anuj Ghai

Background: The need for a Green Claims Code

The Competition and Markets Authority’s (CMA’s) recent publication of the Green Claims Code (the Code) and its final guidance (the Guidance) in respect of environmental claims represents the culmination of extensive consultation and investigation into claims about “green” goods and services.

In recent years, consumers have paid greater attention to the environmental footprint of the products and services that they buy and consume. In 2019, UK consumers spent £41 billion on ethical goods and services — almost four times the amount spent two decades previously. In light of increasing demand for green goods and services, in 2020 the CMA launched an investigation under its consumer protection powers into the impact of green marketing on consumers and carried out inquiries into potentially misleading environmental claims. At the end of its investigation, the CMA found that up to 40% of online green claims could be misleading. As a result of these findings, the CMA published draft guidance on environmental claims on 21 May 2021, and the final Guidance on 20 September 2021.

The new rules follow coordinated regulatory and antitrust scrutiny of overcharging loyal customers.

By David Little, Victoria Sander, Gregory Bonné, and Anuj Ghai

On 28 May 2021, the FCA published a policy statement setting out new pricing practices rules for insurers and insurance distributors. The new rules follow a September 2020 consultation paper and final report. The FCA’s objective is to improve the way general insurance markets function, in particular by preventing firms from “price walking” customers (a pricing behaviour that the FCA considers anti-competitive) and ensuring that firms deliver fair value. The new rules also aim to increase transparency for customers who are renewing their insurance products.

Notably, the new rules:

  • Prescribe the information that firms must give to customers whose insurance products automatically renew
  • Include criteria that firms must take into account when determining whether a product offers value for money
  • Attempt to prohibit price walking

The FCA believes that price walking distorts competition and leads to higher overall prices for customers and that regular switching can help to bring prices down.

The new service encourages UK consumers to report exploitative sales and pricing practices.

By John D. Colahan and Anuj Ghai

On 4 April 2020, the Competition and Markets Authority (CMA) launched an online service called “Report a business behaving unfairly during the Coronavirus (COVID-19) outbreak” (the Online Service) to allow businesses and consumers to report unfair practices related to COVID-19.

The Online Service launch follows the CMA’s recent guidance warning businesses against exploitative sales and pricing practices. In particular, the CMA cautioned traders to behave responsibly and not charge inflated prices or make misleading claims, for example about the efficacy of protective equipment. The CMA noted that members of the public who resell goods, including on online marketplaces, may be subject to the same restrictions. In terms of enforcement, the CMA indicated that it will consider any evidence of breaches of competition and consumer protection law, take direct enforcement action in appropriate cases, and assess whether it should advise the UK government to take direct action to regulate prices.

Companies must mitigate risks to antitrust privilege posed by cross-border megadeals and increased regulatory demand for documentation.

Richard Butterwick, John ColahanMartin DaviesJonathan ParkerOliver MiddletonGregory Bonné, and Catherine Campbell

A strong M&A market has driven a high volume of megadeals across the globe in recent years, with acquirers turning to ambitious transactions. Antitrust issues frequently arise on such complex deals, and in an evolving antitrust environment, taking a planned and strategic approach to privilege during the deal process is crucial. Balancing the need to run a thorough due diligence exercise and transparent deal process with the need to maintain confidentiality and privilege can be challenging. In our view, practical planning for privilege issues forms a key part of successfully navigating international M&A deals.

By Jonathan Parker and Anuj Ghai


The Competition & Markets Authority (CMA) has imposed a £20,000 fixed penalty on Hungryhouse Holdings Limited (Hungryhouse). The CMA imposed the penalty under Section 110 of the Enterprise Act 2002 (EA02) for failure to comply, without reasonable excuse, with a requirement the CMA issued in a notice pursuant to section 109 EA02 dated 31 May 2017 (the First s.109 Notice). The CMA imposed the penalty on Hungryhouse on 22 November 2017, following the CMA’s unconditional clearance of its acquisition of Just Eat plc (Just Eat) on 16 November 2017 (the Transaction). This is the first time that the CMA has imposed a fine on a merging party for failure to comply with an information request.

Factual Background

As part of its inquiry into the Transaction, the CMA issued Section 109 notices to the parties requiring them to produce specified documents and supply specified information to the CMA. On 26 May 2017, the CMA provided Hungryhouse with a draft of the First s109 Notice. The CMA offered Hungryhouse the opportunity to raise any questions relating to the content of the draft, including the availability of the documents, information, or data requested. On 30 May 2017, Hungryhouse responded to the CMA, noting that some of the questions would be difficult to respond to in full within the relevant timeframe, as responses to particular questions would involve access to senior management emails. However, Hungryhouse added that that they would “endeavour to provide all information by the stated deadlines”.

By Jonathan Parker and Calum Warren

On 2 August 2017, the UK Competition and Markets Authority (CMA) launched a consultation on proposals to amend the Office of Fair Trading’s 2012 guidance as to the appropriate amount of a penalty for infringements of the prohibitions against anti-competitive agreements and an abuse of a dominant position contained in the Competition Act 1998 (the Current Penalties Guidance). The consultation proposes the following four main changes to the Current Penalties Guidance, most of which are clarifications to the CMA’s current policy based on its existing decisional practice. The CMA has not proposed any amendments in relation to the adjustment for duration (step 2) or the adjustment to prevent the maximum penalty being exceeded and to avoid double jeopardy (step 5).

1. The starting point for calculating fines (step 1). The Current Penalties Guidance provides that the starting point for a fine may be up to 30% of an undertaking’s turnover in the relevant product and geographic market in the last business year. Whilst the CMA does not consider detailing a starting point for every type of infringement appropriate, and confirms that there is no pre-set “tariff” for different infringements, the CMA proposes to amend the Current Penalties Guidance to state that it will generally use a starting point of:

(i) Between 21-30% for the most serious types of infringement (i.e., those which the CMA considers to be so-called “object” infringements, such as cartel offences, as well as excessive and predatory pricing)

(ii) Between 10-20% for certain less serious object infringements and for infringements by “effect” (i.e., those for which the CMA must carry out an assessment to establish that the behaviour in question has had an anti-competitive effect on the market)

(iii) Less than 10% may be applied if the assessment of the specific circumstances of the case leads to a downwards adjustment. If more than one undertaking has taken part in an infringement, the CMA proposes clarifying that it will expect to apply the same starting point for each undertaking.

By John Colahan, Jonathan Parker and Calum Warren

On 16 June 2017, following a public consultation on proposed changes, the UK Competition and Markets Authority (CMA) published the “Mergers: Exception to the duty to refer in markets of insufficient importance” guidance, which increases the thresholds for the application of the CMA’s so-called “de minimis” (or small markets) exception. Of lesser significance, the CMA’s updated de minimis guidance also incorporates a number of other minor textual clarifications and now includes references to the CMA’s more recent decisional practice and other guidance.

By way of background, the CMA has a duty to refer a merger to an in-depth Phase 2 investigation under section 22 or 33 of the UK Enterprise Act 2002 if it believes there may be a realistic prospect that the merger will result in a significant lessening of competition. In accordance with the current guidance contained in the CMA’s “Mergers: Exceptions to the duty to refer and undertakings in lieu of reference guidance”, the CMA may apply the de minimis exception to the duty to refer if the aggregate size of the market(s) concerned are below certain specified thresholds. The current thresholds are set at £10 million below which the CMA may apply its de minimis exception, and £3 million below which the CMA generally will not consider a reference to a Phase 2 investigation justified.

By Jonathan Parker, Hanna Roos, Hayley Pizzey and James Fagan

The Competition Appeal Tribunal (the CAT) in the UK heard on 17 January 2017 an application by Flynn Pharma Ltd and Flynn Pharma (Holdings) Ltd (together Flynn) to suspend the Competition and Markets Authority’s (the CMA) direction to reduce the price of an epilepsy drug. The CMA had given the direction as part of its unfair pricing decision in December 2016. In its judgment on 19 January 2017, the CAT dismissed the interim application.

The case is significant because it concerns the first CMA decision on excessive pricing, and a substantial fine of £90 million by the CMA for an alleged abuse of a dominant market position by Flynn and Pfizer Ltd and Pfizer Inc. (together Pfizer). The interim relief judgment also highlights the CAT’s focus on the public health impact when assessing the need for interim relief. Flynn and Pfizer are expected to file their appeal of the CMA’s December decision by 7 February 2017, and the CAT’s determination of their appeal is anticipated later this year.

By Hayley Pizzey

On 19 December 2016 the Competition and Markets Authority (CMA) issued two competition law infringement decisions in its galvanised steel tanks investigation. Cylindrical galvanised steel tanks store water in large buildings and supply the water for fire sprinkler systems.

The first decision relates to a cartel (the main cartel). The second decision relates to an exchange, in a single meeting, of price sensitive information between competitors.

The information exchange decision and subsequent fine imposed on Balmoral Tanks Ltd (Balmoral) highlights the CMA’s increased focus on enforcing competition law infringements. The decision also flags to businesses the importance of being cautious when communicating (in any format) with competitors.

By Jonathan Parker

Since its launch in April 2014, the Competition and Markets Authority (CMA) has played a crucial role in determining the outcome of some of the UK’s headline deals. Last year alone, the CMA scrutinised over 60 deals including Poundland’s takeover of 99p Stores, and ran the rule over bookmaker Ladbrokes’ takeover of rival Coral. Other deals included BT/EE, Betfair/Paddy Power, Tullett Prebon/ ICAP and Celesio/Sainsbury’s.

The CMA has not proved timid in its early years.

For buyers and sellers of companies, such as private equity firms, a CMA investigation is often unwelcome, and sometimes unexpected. Convincing the CMA to give a deal the green light can be an unwanted and time-consuming experience.