Following the American Way on Competition Policy
Hilton, Anthony, The Evening Standard (London, England)
Byline: ANTHONY HILTON
THE WAY Britain's competition policy has developed in the relatively short period of governance by the present head of the Competition Commission, Derek Morris, is remarkable. But the revolution thus far - as, for example, with the public hearings in analysis of the proposed Lloyds TSB bid for Abbey National and the far greater commitment to transparency - may not be enough to prevent even more sweeping changes.
Yesterday the courts labelled as unfair the Competition Commission's directive to Belgian brewer Interbrew to sell Bass Brewing because it had decided the purchase was against the public interest. But it was not the commission's finding that was faulted.
Interbrew challenged the commission's processes, in particular the way participants were invited to propose remedies without the commission clearly defining its concerns. The core finding that the combination was anti-competitive was left intact.
Though there is always a tendency to enjoy those with authority being cut down to size, this is not a verdict to celebrate. The basic problem has arisen because the Competition Commission and its predecessor the Monopolies Commission sought to keep their processes informal. Thus these have developed separately from the law and avoided becoming legalistic in the way they have in the US.
But the very lack of legal certainty means companies going through the examination do not always know quite where they are, what is expected of them or what is on the commission's mind. Time was when companies would put up with this. But the stakes in international mergers are now so high that companies crave certainty - which means a legal framework for decisions. They are becoming much less tolerant of the ad hoc British approach and much more willing to mount legal challenges to verdicts they do not like. …