LEGAL NOTICE

 

Both UK and EU competition law prohibit businesses with significant market power unfairly exploiting their strong market positions. Failure to comply with UK or EU competition law can have very serious consequences.

 

Following the merger on 1 April 2014 of the UK Office of Fair Trading and the Competition Commission to form the new Competition and Markets Authority (CMA), businesses operating in the UK can expect more robust enforcement of the competition rules, with higher fines and more criminal prosecutions in appropriate cases.

 

The cinema broadcast business has grown fast and is ever-expanding. Service providers are competing for market share. There is a right way and a wrong way to conduct business. Quantum Digital wants a fair and level playing field. Take note of the penalties the CMA can impose for violating competition law: 

 

  • Firms risk being fined up to 10% of group global turnover

  • Culpable individuals risk director disqualifications

  • Criminal sanctions for serious breaches of competition law could even include imprisonment

 

Any business (whatever its legal status, size and sector) needs to be aware of competition law, firstly so that it can meet its obligations (and in doing so, avoid the penalties mentioned above), but also so it can assert its own rights and protect its position in the marketplace.

In the UK two sets of competition rules apply in parallel. Anti-competitive behaviour which may affect trade within the UK is specifically prohibited by Chapters I and II of the Competition Act 1998 and the Enterprise Act 2002. Where the effect of anti-competitive behaviour extends beyond the UK to other EU Member States, it is prohibited by Articles 101 and 102 of the Treaty on the Functioning of the European Union (TFEU). 

 

Both UK and EU competition law prohibit agreements, arrangements and concerted business practices which appreciably prevent, restrict or distort competition (or where this is the intended result) and which affect or may affect trade within the UK or the EU respectively.

Contravention of Chapter I or Article 101 can have serious consequences for a company including but not limited to:

 

  • firms engaged in activities which breach these provisions can face fines of up to 10% of group global turnover;

  • firms in breach of Chapter I or Article 101 also leave themselves exposed to actions for damages from customers and competitors who can show they have been harmed by the anti-competitive behaviour; and

  • breach of Chapter I can result in individuals being disqualified from being a company director and lead to criminal sanctions.


Contravention of Chapter II or Article 102 can have serious consequences for a company including but not limited to:

 

  • firms engaged in activities which breach these provisions can face fines of up to 10% of group global turnover;

  • firms in breach of Chapter II or Article 102 also leave themselves exposed to actions from third parties who can show they have suffered loss as a result of the anti-competitive behaviour; and

  • breach of Chapter II can result in individuals being disqualified from being a company director

 

Quantum Digital operates across the UK and European cinema industry, as well as worldwide. Interference, market abuse or any degree of foul play is completely unacceptable.

 

From early 2019 onwards, it is expected that many EU laws will remain enshrined in UK law, following the UK's eventual exit from the EU, subject to the UK government's final determination. In any event, UK competition law will remain in force and should not be taken lightly. 

 

In view of the severe consequences of non-compliance with compeition law, it is recommended that businesses regularly review whether the company's practices and agreements comply with competition law. For any company (and especially any company with a significant share of the markets in which it is active), it is vitally important to promote an understanding amongst employees as to what type of behaviour is and is not permissible under competition law.

© 2020 MARC JOHN