The United Kingdom
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Chapter XII
THE UNITED KINGDOM
A. The Sources and Basics of Antitrust Law in the United
Kingdom
In the United Kingdom, a member state of the European Union,
competition law exists both at the domestic U.K. level and at the EU
level. EU competition rules have been described in detail in the
European Union Chapter above. This chapter focuses on domestic U.K.
law.1
U.K. competition law is set out in the Competition Act 1998
(Competition Act),2 as amended by the Enterprise Act 2002,3 and applies
to agreements that affect trade within the United Kingdom. “Chapter I”
(sections 1 through 16) of the Competition Act mirrors Article 101 of the
Treaty on the Functioning of the European Union (TFEU) (i.e., the EU’s
prohibition on restrictive agreements), while “Chapter II” (sections 18
through 24) of the Competition Act mirrors Article 102 of the TFEU (i.e.
the EU’s prohibition on abuse of market power).4
The guiding principle of the Competition Act is that it must be
interpreted in such a way as to ensure consistency with the treatment of
corresponding questions arising under EU competition rules. 5
Accordingly, U.K. authorities are bound to follow the precedents of the
1. There are in fact three separate legal systems in the United Kingdom:
England and Wales, Scotland, and Northern Ireland. By and large,
competition law is identical in all three systems (the only difference
involves court procedures in Scotland and these differences are not
considered further in this chapter).
2. Competition Act 1998, 1998 Chapter 41.
3. Enterprise Act 2002, 2002 Chapter 40.
4. Treaty on the Functioning of the European Union, Sept. 5, 2008, 2008
O.J. (C 115) 47 as amended by the Treaty of Lisbon Amending the
Treaty on European Union and the Treaty Establishing the European
Lisbon]. The texts of Articles 101 and 102 of the TFEU are identical to
the text of Articles 81 and 82 of the EC Treaty, which was amended and
renumbered by the Treaty of Lisbon effective December 1, 2009.
5. Competition Act 1998, § 60.
360 Antitrust Issues in International IP Licensing Transactions
European Court of Justice (ECJ) and the General Court (GC) and to
follow any decisions adopted by the European Commission. Much of
what has been discussed in the European Union chapter is, therefore,
relevant in the United Kingdom. However, because of the two-tiered
structure of competition law as it applies in the United Kingdom, parties
to IP transactions with effects in the United Kingdom always should
confirm their EU analysis in light of the U.K. rules. As is the case in all
EU member states, local administrative and court practice may differ
from the EU approach. In addition, local enforcers may have addressed
issues that have yet to be addressed by the European Union at the time of
the agreement.
In the United Kingdom, there are two antitrust authorities: the
Office of Fair Trading (OFT), the primary or main antitrust authority;
and the Competition Commission (CC), which conducts in-depth
examinations of mergers and performs certain functions in relation to
regulated industries and market investigations.6 Issues relating to IP
licensing will almost always be a matter for the OFT to decide.7
The OFT is empowered to enforce both U.K. competition law and
Articles 101 and 102 of the TFEU. Where an agreement affects trade
between member states of the EU, Regulation (EU) No 1/2003 requires
the OFT to apply Article 101 to the agreement in parallel with the U.K.
competition rules. The OFT has stated that it will consider the European
Commission’s Effect on Trade Notice8 in applying the effect on trade
principle in actual practice.9
1. Agreements that Restrict Competition
Chapter I of the Competition Act is almost identical in terms to
Article 101 of the TFEU. It prohibits any agreement, decision, and
concerted practice by undertakings and associations of undertakings that
may affect trade within the United Kingdom and has as its object or
effect, the prevention, restriction or distortion of competition within the
6. See §§ 22, 33 and 131 of Enterprise Act 2002 establishing the OFT’s
power to refer to the Competition Commission.
7. Enterprise Act 2002, §§ 22, 33, 131.
8. Commission Guidelines on the Effect on Trade Concept Contained in
Articles 81 and 82 of the Treaty [Establishing the European Community],
2004 O.J. (C 101).
9. OFT Guidelines 442 on Modernisation (December 2004), ¶ 4.6 available
at http://www.oft.gov.uk.
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