The competition watchdog has written to Energy Secretary Amber Rudd highlighting competition issues in the North Sea oil and gas sector.
Alex Chisholm, CEO of the Competition and Markets Authority (CMA) has told Ms Rudd she must ensure the new Oil and Gas Authority (OGA) takes account of any risks to competition created by the Energy Bill.
The UK Government reaffirmed its support for the development of the oil and gas industry in the North Sea earlier this year after the OGA was given new powers to fine companies and revoke exploration licences.
Mr Chisholm highlighted potential competition risks such as the work of the OGA helping create an environment where companies might form anti-competitive agreements or exchange sensitive information on future pricing intensions.
The CMA believes it is important the OGA “acts at all times in accordance with competition law” as well as promotes and supports competition in industries it regulates.
The call comes as the watchdog was granted new powers to make and publish written recommendations to ministers on the impact of proposals for legislation on competition.
The letter stated: “The provisions in the Bill give rise to some risks to competition and to the effective functioning of markets.
“Our recommendations are primarily concerned with ensuring that in discharging its responsibilities, the OGA takes due account of risks to competition and of the impact of its actions on competition in markets. We trust that you and your department will want to consider the recommendations carefully and where necessary, to act.”
The CMA has also contacted the OGA to help ensure it doesn’t breach competition law when working with the industry.