Energy & Renewables Bites: Land Agreements & Competition Law

In April this year, the treatment of land agreements under EU competition law has now radically changed. Whereas previously land agreements such as leases, sub-leases, and title deeds and conditions, generally have been allowed to contain restrictions, such restrictions will now be subject to the rules of competition law. In preparation for this, the Office of Fair Trading has released draft guidance for businesses intending to conduct reviews into their land agreements. Such guidance intends to provide a practical framework for conducting these reviews by highlighting certain aspects of the new legal framework including:

That it only applies to "undertakings" and will not affect individuals not engaged in business; That while not retroactive, it does apply to all existing land agreements as from 6 April 2010; That restrictions by themselves do not give rise to a presumption of infringement; That to infringe, the restriction must appreciably affect competition in the relevant market; and That restrictions which make it more difficult for a business to enter into or compete in the relevant market are more likely to be seen to be anti-competitive. The type of restrictions that will fall foul of the competition law regime will depend upon their effects on competition and not on the particular wording of that restriction. There are exemptions for certain restrictions, such as that found under s.9 of the Competition Act if it can be shown that a restriction brings economic and consumer benefits and that it has been drafted in the lease restrictive manner possible. Although no definitive list of restrictions can be drawn up, examples of restrictions which may be...