The FCA’s competition powers: One year on
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Today marks the first anniversary of the FCA’s competition powers, which the FCA obtained on 1 April 2015. On the run-up to this anniversary, Deb Jones, Director of Competition at the FCA, delivered a speech at The Impact of Competition Powers on Financial Services Conference. A few points of interest can be gleaned from what she had to say about the FCA’s Competition Act 1998 powers:
Moving towards its first Competition Act investigation
The FCA is now “taking active steps towards the opening of Competition Act investigation”. Unsurprisingly, given the early stage of the investigation, Deb Jones doesn't give any details on the case. But after a year of work majoring on market studies, she is keen to send a signal that the FCA takes competition law as seriously as other regulatory enforcement.
‘Softer’ enforcement measures
The FCA is also using softer enforcement measures, mimicking the practice of the Competition and Markets Authority.
- First, it has issued two “on notice letters” to firms relating to concerns it identified during the course of the retirement income market study. The FCA sends such letters where the evidence suggests that there may be a potential infringement of competition law but the FCA’s prioritisation does not lead to opening an investigation. The FCA met with the firms concerned and they have subsequently undertaken a number of initiatives to strengthen competition compliance.
- Second, the FCA has issued three “advisory letters” with the aim of ensuring greater compliance through increased awareness of competition law.
An uptick in Principle 11 notifications relating to competition law breaches
Deb Jones also reported that amendments to the FCA Handbook to “reinforce the obligation on authorised firms to report significant infringements of applicable competition law to the FCA” has resulted in an uptick in notifications under Principle 11 (which we reported on last year).
What the future holds
Deb Jones notes that the FCA’s competition enforcement powers are just one aspect of its competition tool kit, “no more and no less important than the others”. On that basis, given the scale of work undertaken on market reviews, it may well be that further Competition Act cases are in the pipeline.