It’s well established that trade associations must comply with competition law – both in respect of their internal rules of membership and how they engage with their members and non-members. Investigations by competition regulators are however relatively rare.

Earlier in the summer, the Office of the Rail Regulator (ORR), which has competition law as well as sectoral powers, issued a decision accepting legally binding commitments from the Railway Assessment Centre Forum (RACF). This was a key stage in ORR’s investigation into RACF’s membership rules and related practices concerning accreditation for train driver assessment centres. RACF’s commitments entail significant changes to its membership application rules to address the ORR’s concerns.

Whilst this is not an ‘infringement’ decision under UK competition law as such, it is a timely refresher on the competition risks that need to be avoided by trade associations, representative and accreditation bodies.

The psychometric testing of train drivers in the UK is an annual safety requirement. There is a set, legal standard for this testing and the Rail Safety Standards Board (RSSB) oversees compliance. Historically, testing has been conducted ‘in-house’ by train and freight operating companies plus one external provider. These companies are in turn members of RACF – a self-appointed body.

In its investigation, ORR found that RACF was effectively a ‘gatekeeper’ in the provision of train driver psychometric testing. RACF membership had become a prerequisite in order to qualify as an assessment centre. In addition, members were unwilling to work with non-members and some of the approved psychometric testing materials were ‘owned’ by the existing centres. To aggravate matters, RACF membership criteria and the application process were not transparent and it was unclear what standards applicants had to meet.

The following of the RACF’s membership rules were of particular concern:

  • Membership criteria were unpublished;
  • Applicants were required to provide extensive, commercially sensitive information including strategic business plans;
  • A ‘mentor’ was required to be appointed from amongst members with no clear scope;
  • Existing members vetted and voted on new membership applications;
  • There was no route for appeal.

RACF has now amended and published its rules of membership to address ORR’s competition concerns. ORR has commented that:

Compliance will not be difficult to ascertain and monitor. Any new potential entrant will be able to inform ORR if there are issues relating to compliance with the commitments”.

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Please do contact us if this briefing strikes a particular chord or you would like to explore this topic further. For example, your membership rules might be overdue some (legal) housekeeping or you might simply be trying without success to pursue a membership application and feel you are not being treated fairly.