Wednesday, 9 May 2012

The 2012 Queen’s speech, Competition and Markets Bill - some implications for Selling

OFT and CC are dead! Long live the CMA

Wednesday 9 May 2012 sees the State Opening of Parliament.
The State Opening marks the formal start of the new 2012-13 parliamentary session. The primary purpose of this glittering state occasion is to set out the Government’s legislative agenda in the Queen’s Speech.

Her Majesty the Queen on her way to the Palace of Westminster to open Parliament May 2012
 Beneath the  bluster of headline news from this year's Queen’s speech on such issues as House of Lords reform, ring fencing ' casino banks', easier hiring and firing for employers, overhauling public sector pensions, and monitoring of emails and electronic communications etc.  our coalition Government have introduced after consultation and new authority - the Competition and Markets Authority CMA.

The coach enters the Palace at Westminster via the Sovereign's Gate

 It is the UK coalition government’s desire to streamline procedure and governance.

So we lose now the office of fair trading (OFT) and the competition commission (CC).

The former CC conducted second-stage reviews of mergers and markets  benefited the country  from its autonomy and expertise. It preserved sufficient institutional safeguards for the independence of the second phase. Today's announcement of the launch of the new CMA  will make it the chief organisation for future enforcement.

The competition and markets bill

The CBI describe the reforms in this bill as “evolutionary rather than revolutionary”. The reduced  bureaucracy  and duplication of processes firms need to go through to meet competition law  are to be broadly welcomed .

However the CBI reckon the new bill is likely to have increased risks.

The change to the cartel offence is likely to confuse and cause uncertainty and the ability of the  secretary of state to request market investigations on the basis of public interest is likely to politicise the competition regime.

The substantial cost and reputational threat to business of not raining the bar for market investigations is an on-going concern

The Department for Business Innovation and Skills state
"The new Competition and Markets Authority (CMA) will be responsible for promoting effective competition in markets across the UK economy for the benefit of consumers and allow more effective co-ordination with Trading Standards.

Above all the proposals will help streamline the consumer landscape and ensure a powerful consumer voice to business, government and regulators"
I guess its work will focus on the Private Sector.

Selling has to be interested in anything from Government where the consumer landscape  will be streamlined ( I assume they mean the market)  and the empowerment of the  voice of the consumer whether to , government or regulators.
What I guess might intrigue some of  us in selling is how the new CMA  would propose to act  in  the Public sector market place . There are circumstances where Government  is the Corporate Buyer and deals with suppliers .

The current legal challenge of Novartis on the NHS over drugs in the treatment of wet AMD might for example could  well prove an interesting early  test for the fledgling organisation should they care to engage after the courts and te lawyers have done their bit..

Novartis is challenging the NHS on the use of intravitreal bevacizumab (Avastin™) instead of the NICE-recommended ranibizumab (Lucentis™) for the treatment of wet age-related macular degeneration (AMD).

Both drugs are manufactured by Novartis but bevacizumab is not licensed for this indication and has been widely used off-label because it is a cheaper alternative.

Ranibizumab costs around £740 per injection, and has been specifically developed for use in ocular conditions with a supporting European licence and safety approval for treating wet AMD. Bevacizumab costs around £60 per injection and has been widely used off-label.

The NHS faces a legal dilemma – using a cheaper unlicensed alternative drug that appears to be effective versus a more expensive, licensed formulation that has been approved by NICE.
What is fair for the buyer ? What is fair for the supplier? The implications of this particular case could be wide reaching for both the procurement side of Government and their suppliers.

Will the new CMA dare to dive into these troubled public sector waters from a  market competition and fair trading governance perspective ?

                                                             The Royal Guard

                                             The Westminster Abbey Bells ring out

Fancy a challenge set by the Government?

 Department of Business for Innovation and skills BIS
Competition to find most enterprising place in the UK

There are three categories in this year’s awards:

· The most enterprising place in the UK.

· The organisation that best promotes enterprise.
· The organisation most successful in encouraging businesses to export.

Two of the three winners will go on to represent the UK at the European Enterprise Promotion Awards in Nicosia, Cyprus on 15 November 2012, during Global Entrepreneurship Week.

Enterprising Britain is free to enter and is open to all places in the UK that can demonstrate the impact enterprise has had on their community in the past two years. To register interest email your contact details to

Entries must be submitted by 30 May 2012 and the winners of each category will be announced on 16 July 2012.

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