Association of British Insurers' General Terms of Agreement

No. CA98/04/2004

This decision was appealed to the Competition Appeal Tribunal on 22 June 2004. On 30 July 2004 the Competition Appeal Tribunal set aside the OFT's decision. In addition, the OFT gave an undertaking to the Competition Appeal Tribunal, in which the OFT would reconsider whether it had reasonable grounds to suspect that the General Terms of Agreement restricted, distorted or prevented competition. For further details see Competition Appeal Tribunal website.

On 29 January 2007 the OFT closed its file on its reconsideration of the General Terms of Agreement as this case no longer constitutes an administrative priority. Please see the case closure summary.

22 April 2004

The Office of Fair Trading has considered a request from the Association of British Insurers (ABI) for a decision on the application of the Chapter I prohibition of the Competition Act 1998.

The OFT has concluded that the ABI's General Terms of Agreement infringes the Chapter I prohibition by operating a centralised, subscriber-controlled system of setting credit hire fees, which may have the effect of appreciably preventing, restricting or distorting competition between ABI members and between credit hire operators. However, it is the view of the OFT that if changes to the agreement as notified are made, then the agreement would qualify for individual exemption.

Rule 14(2) and rule 12 notices setting out the OFT's proposal to grant a conditional exemption were issued on 7 January 2004 and 26 January 2004 respectively. Responses were received from insurers and their representatives, credit hire operators and their representatives and other trade associations or pressure groups. The OFT has taken account of these representations in reaching this decision.

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