Headlines: February 14th, 2002

The OFT and Cabinet Office have issued joint guidance to policy makers across Government on how to assess the impact of proposed policies and legislation on competition in the market place.The guidance starts from the premise that competition drives innovation and productivity, and helps consumers get a good deal. The importance of ensuring that Government policies and regulations do not distort or restrict competition was highlighted in the DTI White Paper, ‘Opportunity for All in a World of Change,’ published last year.

The new guidance is to be rolled out with immediate effect and will be compulsory by September. Policy makers will carry out a Competition Assessment as part of the more general Regulatory Impact Assessments they are already required to undertake.

‘Guidelines to Competition Assessment: A Guide to Policy Makers Completing Regulatory Impact Assessment’ sets out a two stage process for examining the competition implications of proposed policies:

– A simple first stage filter identifies policies where there is a risk of a substantial detrimental effect on competition.

– Where such a risk is detected a detailed assessment is required and the guidelines provide a reference manual to policy makers on how to do this.

The OFT and Cabinet Office have attempted to minimise additional bureaucracy and to be consistent in their new policy. They point out it should help the design of better regulations, with lasting benefits for businesses, government and consumers.

The new guidelines can be found on the OFT website at www.oft.gov.uk.