Markets for public services continue to be opened up to the private and voluntary sectors. Effective competition in those markets can benefit the wider economy by encouraging greater productivity and innovation and preserving long term growth, while continuing to provide greater value for money for users and taxpayers. Public bodies are also increasingly seeking to generate revenues by utilising assets or spare capacity in markets beyond their core public functions.
Such developments reinforce the need for public bodies to be aware of their existing and ongoing obligations under UK and EU competition law when carrying out their functions.
Public bodies must comply with the UK and EU competition law prohibitions on anti-competitive agreements and abuse of a dominant position if and when they engage in 'economic activity', as opposed to carrying out non-economic, wholly social functions or exercising public powers.
To that end, The OFT has produced a guide to assist public bodies by providing a high level outline of the circumstances in which their activities will be 'economic activities' subject to the UK and EU competition law.
Further background information on the guide and the OFT's work in public service markets is provided in the Questions and answers.
The guide provides high level guidance on the Competition Act 1998. Public bodies seeking a more definitive indication as to whether any of their specific activities are subject to UK or EU competition law should seek legal advice in the first instance.
In cases involving genuine uncertainty, the OFT should be approached, as it may - in appropriate circumstances - provide a public body with a non-binding Short-form Opinion on the application of the CA98 to a specific collaborative activity.
For queries about this guide that cannot be addressed through legal advice, or to enquire as to the possibility of a Short-form opinion, please contact the OFT's Enquiries and Reporting Centre on 0845 7 22 44 99, who will direct you to an appropriate person.
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