COMPETITION COMPLIANCE POLICY

The Age Verification Providers Association (“AVPA”) can itself be liable for breaches of competition law, and that a breach can have both financial and reputational consequences for the association.

The AVPA has established this competition compliance policy for the association, and members are informed of it prior to joining, and reminded of it annually.  Representatives of members attending meetings are asked to first watch this video from the CMA.

Members acknowledge and agree that the AVPA:

  • forbids members from discussing competitively sensitive information
  • requires members to leave, and to report to the association or the CMA, any meetings with competitors where competitively sensitive information is discussed
  • ensures that any standard contract terms and conditions developed by the association are published and are clear, easily understood, in plain language and fair to consumers
  •  ensures that rules and admission criteria for the association are published and transparent, proportionate, non-discriminatory and based upon objective standards
  • ensures that the requirements for any quality certification schemes the association operates are fair, reasonable, published and available to all businesses that meet them

Members further acknowledge and agree that the AVPA does not:

  • have rules that prevent the members from taking independent commercial decisions 
  • let the association be a channel for, or otherwise facilitate, the sharing of competitively sensitive information between members about pricing, customers or output plans 
  • allow members to discuss competitively sensitive information in or around association events, including in ‘unofficial meetings’ or at social events 
  • issue formal or informal pricing or output recommendations to members 
  • develop association rules or practices that restrict members from advertising their prices or discounts, soliciting for business or otherwise competing with other members 
  • require members to provide the association with competitively sensitive information, such as information about pricing and/or output intentions 
  • publish messages suggesting that lower prices means lower quality 
  • establish irrelevant or arbitrary rules for the admission of new members 
  • adopt rules that restrict members’ advertising and promotional business practices, beyond ensuring such practices are legal, truthful and not misleading 
  • prevent members from using different contractual conditions from any association developed standard conditions, if they wish to do so

This policy applies to all forms of Membership.

COMPETITION COMPLIANCE STATEMENT

We recognise the importance of ensuring that the Age Verification Providers Association (“AVPA”) and the age verification industry as a whole is and remains compliant with competition law and anti-trust law. We also want to be able to demonstrate to our members, partners and regulators that we encourage competition in the UK age verification market fairly, lawfully and with integrity at all times. 

This statement describes the general principles which underlie competition law and principles with which we abide and encourage our members to abide by. This statement should be regarded as a tool which raises awareness to promote and support compliance with competition law. 

Overview of the law 

Competition law in the UK is primarily contained in the Competition Act 1998, which brings into force certain EU competition rules from the Treaty of the Functioning of the European Union. The object of these competition laws is to:

  • prohibit agreements or contracts which seek to restrict competition; 
  • prohibit abuse of a dominant position in a market; and 
  • make hardcore cartel activity a criminal offence.

 Although competition law is generally enforced worldwide, there is no single global competition statute. All members and employees of the AVPA should be aware that, wherever they do business in the world, they need to comply with relevant national competition laws. In particular, dealings in the US may be subject to federal and state anti-trust laws. In this respect it is important to recognise that actions taken in one country may have an impact in others, and certain actions can be subject to the laws of various countries. 

The Competition and Markets Authority (“CMA”) is the main regulator and enforcer of competition law in the UK, responsible for investigating potential breaches of competition law and relevant merger situations which may substantially lessen competition in a particular market. Penalties for breaching competition law are severe, and include:

  • fines of up to 10% of global turnover; 
  • Contracts being considered null and void, which means they cannot be enforced; 
  • criminal liability punishable by imprisonment and / or fines (this extends to individuals involved in cartel activity); 
  • disqualification of directors; • reputational damage; and 
  • lengthy and costly regulatory investigations.

Regulatory investigations in particular can impact a whole industry, as often competitors, suppliers, customers and trade associations are required to assist and input into an investigation into one party. The CMA also has the power to conduct market-wide investigations into competition. Due to the severity of the potential sanctions which may be enforced as a result of a breach of competition law, it is of utmost importance that any member of the AVPA suspecting any potentially breaching behaviour reports this to the Executive Director of the AVPA as soon as possible. 

Competition law and the age verification industry 

The AVPA’s role is to promote and champion the UK age verification industry. Facilitating the sharing of information and market intelligence between parties that could be considered competitors is a significant part of this role. This work is essential for our legitimate purposes of identifying issues within the industry which require to be addressed, identifying new opportunities for all of our members, and encouraging collaboration between parties which can benefit the market as a whole. 

We recognise that the sharing of commercially sensitive information between competitors which may influence the independent determination of commercial strategies is often an indication of prohibited co-ordination or a cartel. We encourage our members to follow the guidelines below to ensure that competition compliance is maintained in balance with the fulfilment of our legitimate functions. The examples in this list are not exhaustive. 

Appropriate

Not Appropriate

Discussions between parties who do not directly compete with each other

Closed discussions between parties who are direct competitors about other competitors, suppliers and customers

Discussions about non-confidential or non-sensitive information (such as publically availably information about issues affecting the industry as a whole)

Discussions about confidential or commercially sensitive information not in the public domain (such as private pricing information, sales or customer information, or trade secrets)

Entering into non-exclusive agreements. Exclusive agreements are not prohibited but should be balanced and not contain any hardcore anti-competitive restrictions

Binding a customer or supplier to unreasonable exclusivity conditions

Independently determining which customers / territories to pursue

Colluding with a direct competitor to each only pursue certain customers / territories (i.e. carving up the market)

Independently entering bids / tenders for opportunities, or working with other parties on bids where you cannot submit an independent bid

Deciding with a competitor to set agreed prices and other conditions for bid (or “bid-rigging”), and each agreeing to only pursue certain bids (carving up bids)

Independently deciding not to work with a particular customer or supplier for objectively justifiable reasons (such as a negative credit check)

Agreeing with other parties to “boycott” a particular customer or supplier to drive them out of the market for no objective reason

Collaborating with other parties to develop and produce new technologies, which all parties involved are free to exploit commercially

Developing technology based on information which was improperly obtained from a competitor

Setting prices based on independent market conditions, or depending on the existing relationship / arrangement with a specific customer

Agreeing with a competitor to set prices for the market, or to otherwise work together to influence the price (such as limiting production to increase demand and, as a result, prices)

 

Industry Meetings Disclaimer:

The AVPA regularly facilitates meetings and events between members and other organisations involved at each level of the age verification supply chain in pursuance of our legitimate interests as a representative body of the industry. Discussions at these meetings should be open and conducted in accordance with the guidelines set out in our Competition Compliance Statement. 

Members acknowledge that the role of the AVPA in respect of industry meetings and events is to act as a neutral facilitator of discussions on issues affecting the industry as a whole. The AVPA does not take ownership of, or responsibility for, any individual or collective decision or action that may be made and / or agreed between members, whether in attendance at a meeting or event organised by the AVPA or otherwise. Unless expressly confirmed by the AVPA in writing, any decision made as a result of the discussions at a the AVPA meeting or event is not condoned or agreed to by AVPA.