A new Annual Plan for the Competition and Markets Authority

The CMA has published its Annual Plan for 2024 to 2025 (the “New Plan”), following engagement with more than 70 businesses and other organisations across the UK.

The New Plan builds on the CMA’s multi-year strategy which was introduced in 2022/23 and is based on “delivering positive impact for people, businesses, and UK economy, while ensuring the CMA has the capabilities and expertise required of a 21st century competition and consumer protection authority."

Purpose, strategy and ambition

The New Plan explains that the CMA’s strategy flows from an overarching purpose, which is “to help people, businesses and the UK economy by promoting competitive markets and tackling unfair behaviour.”

Below this sits the CMA’s ambition, which is to promote an environment with three strategic outcomes:

• People can be confident they are getting great choices and fair deals

• Competitive, fair-dealing businesses can innovate and thrive

• The whole UK economy can grow productively and sustainably

Priorities: short term

The CMA will be taking on new responsibilities and be granted enhanced tools by way of the Digital Markets, Competition and Consumers (DMCC) Bill, which is expected to receive Royal Assent in April 2024. The New Plan addresses this by updating the CMA’s Areas of Focus for the next 12 months. These now include:

• acting in areas of essential spending and where people are under particular financial pressure, such as accommodation, caring for ourselves and others, and travel;

• broadening our work to protect consumers from harmful practices in online choice architecture and misleading pricing;

• enabling innovating businesses to access digital markets such as cloud services, e-commerce, and digital advertising;

• encouraging effective competition and consumer protection in emergent markets, including the development and deployment of AI foundation models;

• acting in existing and emergent markets for sustainable products and services, including through broadening our green claims work, encouraging competitive markets for climate technology, and implementing our Green Agreements Guidance; and

• identifying and acting in areas where we can influence the pro-competitive development of markets and have the most positive impact on innovation, growth and productivity, and promoting resilience through competition.

Priorities: medium term

The New Plan also sets out detail of the CMA’s medium-term priorities (for the next three years), which have been updated to a limited extent to reflect recent developments with the UK economy.

The previous priority specifically relating to promoting resilience through competition has been merged this with the medium-term priority on prioritising sectors that contribute to innovation and productivity, meaning there are now three. The CMA sets these out in the New Plan, organised under the three strategic outcomes of its ambition (as set out above).

• People can be confident they are getting great choices and fair deals: Resolutely deter anti-competitive behaviour. Consistently focus action on the areas where consumers spend the most money and time, particularly for people who need help the most. Protect people from harmful practices.

• Competitive, fair-dealing businesses can innovate and thrive: Resolutely deter anti-competitive behaviour. Enable open access to markets for innovating businesses. Help emergent sectors to develop into high growth, innovative and competitive markets.

• The whole UK economy can grow productively and sustainably: Help accelerate the UK’s transition to a net zero economy. Prioritise sectors that offer the biggest potential for impact on innovation, productivity and promoting resilience through competition.

The CMA explains that these priorities will mainly inform the activities where it has a degree of discretion over its work, such as competition and consumer law enforcement, market studies and investigations, and its advocacy work. In contrast, its merger control caseload is driven mainly by which mergers are announced in a given period.

Achievements last year

The New Plan sets out, in detail, the CMA’s key achievements in the 2023-24 period, again organised under the three strategic outcomes of its ambition. This section of the plan reveals a very busy and expansive workload. The CMA’s documented achievements include:

• concluding its market studies on road fuels and housebuilding

• reviewing unit pricing practices across large groceries retailers, launching a market study in relation to infant formula, and launching a review of loyalty scheme pricing by supermarkets;

• reviewing the vet sector;

• launching two investigations relating to TV producers and broadcasting;

• issuing findings in relation to five major banks and their online exchanges of competitively sensitive information, and in relation to collusion between a sports retailer and football club;

• its in-depth and high-profile merger inquiry into Microsoft’s proposed acquisition of Activision;

• a market investigation into public cloud infrastructure services;

• an initial review of artificial intelligence foundational models; and

• its work in the green heating and insulation sector.

Areas of focus for 2024-25

The New Plan details some updates the CMA is making to its areas of focus for the next 12 months (from 1 April 2024). The CMA explains that one area of focus will be the travel sector, particularly the road fuels market. Another is housebuilding – this is not surprising given the announcement on 26 February 2024 that the CMA had opened a formal investigation into suspected breaches of competition law involving eight housebuilding companies.

Once the DMCC Bill has been passed and comes into force, the CMA will be able to take advantage of a new administrative enforcement model which it says will transform the impact of the consumer enforcement action it takes, “empowering us to decide when consumer law has been broken, rather than having to take each case to court, and giving us the ability to directly impose significant financial penalties.”

Other areas of focus include the development and deployment of AI foundation models, sustainable products and services including misleading green claims (and implementing the CMA’s Green Agreements Guidance), enabling innovation, and digital markets (where the DMCC Bill, once enacted, will allow the CMA use new and targeted powers to intervene and regulate firms that it designates as having ‘Strategic Market Status’). The CMA will also be providing advice to governments to support the effective trading between UK nations through its Office for the Internal Market.

The CMA’s impact and resources

Although the CMA has issued only one infringement decision (with a fine of £880,000) over the last 12 months, an interesting part of the New Plan sets out what the CMA describes as “the direct monetised benefit to consumers of our work over a three-year rolling period". The CMA’s calculation shows that it delivers direct financial benefits of “over £20 for every £1 of taxpayer money spent, well in excess of the target of £10:1 set by government.”   

As the New Plan notes, the CMA will continue to be very busy: it is currently handling 24 merger investigations, 11 competition enforcement cases, nine consumer protection cases, one market study and two market investigations. Its budget for 2024 to 2025 totals more than £130 million (including Resource Departmental and Capital Departmental expenditure limits).

The New Plan can be found here.

about the authors

Caroline Day is a Partner in our Criminal Litigation team. Caroline specialises in complex fraud and financial crime. She acts in cases of serious fraud, money laundering, corruption and cartels and has advised individuals and companies subject of investigations and prosecutions by various agencies including the Serious Fraud Office (SFO), the Financial Conduct Authority (FCA), HM Revenue and Customs (HMRC) and the Competition and Markets Authority (CMA) (formerly the OFT).