Under Government proposals on competition law reform, complaints from consumer organisations and trade bodies will be dealt with under a fast-track procedure by the newly-established Markets and Policy Initiatives division. While there is some way to go before the proposals get the force of law, the OFT is already using the super-complaints system.
The complaint was re-ceived from the Consumers' Association and alleges a lack of competition and tariff discrepancies in private dentistry.
The Consumers' Association's in-house department is dealing with the procedure. The General Dental Council and the British Dental Association have not yet instructed external counsel.
According to Martin Coleman, head of Norton Rose's competition practice, dentistry is just the tip of the iceberg. “This could hit almost any area of UK business at any time,” he said.
The OFT is already investigating consumer IT, pharmacies and extended warranties on consumer goods.
“This gives a lot more power to consumer bodies and trade bodies to trigger the investigatory mechanism”
Martin Coleman, Norton Rose
The OFT has been given a swath of new resources to investigate competition complaints. The super-complaint procedure is to be backed up with 80 new people, of whom around 45 are already in place, and substantial amounts of cash.
The OFT has 90 days in which to investigate the substance of the complaint before deciding whether to proceed. Under the law as it stands, the OFT could institute a formal investigation under the Competition Act, refer the issue to the Competition Commission for a monopolies investigation, or apply consumer protection legislation.
According to Coleman, the worry is that the super-complaints procedure gives the OFT a potent weapon. He said: “This gives a lot more power to consumer bodies and trade bodies to trigger the investigatory mechanism. This must be a concern to businesses that are investigated in response to complaints that are not necessarily well conceived.”
An OFT spokesman claimed that companies will not have to expend many resources at the initial stage and that the regulator will not process complaints that are not well-founded. While there is a long way to go before the impact of the new powers can be properly assessed, this may well turn out to be another lucrative government reform for competition lawyers.