Document Outlines Framework For Co-Operation
The Competition and Markets Authority (CMA) has published a memo of understanding outlining its role and how it will be co-operating with the Financial Conduct Authority (FCA).
Published earlier this week, the document outlines the respective, complementary roles of the organisations and how they intend to work together to tackle the key issues where their interests overlap.
It added that the aim is to ensure the relationship between the CMA and the FCA follows on from close relationship between the latter and one of the CMA’s predecessors, the Office of Fair Trading.
The memo of understanding added: “It is vital that we work well together to make the best use of our powers, skills and experience so that we can maximise our effectiveness in making financial services markets work well for consumers.
“This means making sure that we share information so that problems are identified quickly and making sure that action, when needed to tackle problems, is either co-ordinated or taken forward by the organisation that is best placed to achieve results.”
Under the Financial Services (Banking Reform) Act 2013, the FCA will have powers under the Competition Act 1998 to enforce the competition law prohibitions in relation to the provision of financial services, and under the Enterprise Act 2002 to make market investigation references to the CMA for detailed review of a particular market.
"These concurrent competition law powers are expected to come into force in April 2015, to give the FCA time to gain the necessary expertise to implement its new powers effectively. Under these powers, the FCA with the CMA will be able to investigate possible breaches of the prohibition on anti-competitive agreements and the prohibition on abuse of dominance. It will also be able to make market investigation references to the CMA if it identifies a feature or features of a market which give rise to an adverse effect on competition.
"The question will be which regulator is best placed to deal with a particular case."
Sarah Wallace - Partner