1. The Interface between Competition Policy and Sectoral Regulation: A UK perspective Nicola Mazzarotto, Economic Adviser* * The views expressed in this presentation are my own and do not necessarily represent those of the Competition Commission or of any of its members

2. Regulation and competition What to regulate and how? Interactions between regulatory policy and competition policy The role of the UK Competition Commission Conclusions

3. What to regulate and how? There are costs and benefits to regulation The choice of what and how to regulate is key It is not a choice made “once and for all” –New technologies can open the way to competition (eg Telecoms; electricity generation; etc.) and make regulation redundant –But changes in the market may also create the need for regulatory intervention (eg Financial services in the UK)

4. Interactions between regulators and competition authorities Shaped by the legal framework Inevitable: –Merger policy (eg firms under yardstick competition) –Antitrust enforcement (Zambia Energy Regulation Board and ZCC on fuel price increases) Desirable: –Exchange of knowledge about the markets (eg FSA -> CC) –Collaboration on reaching consumer welfare goals

5. The role of the UK Competition Commission Both regulation (MIR and appeals) and competition (mergers); Some examples: Market inquiries: –Eg Mobile phones termination charges (2003) –Extended Warranties for DAGs –Current Groceries Inquiry Merger Policy: –Zeiss/Bio-Rad (IPRs) –Current merger between water companies

6. Conclusions Importance of a clear legal framework. Who does what? Importance of good working relations: –For each to do their job properly –To best adapt to changing market conditions