On Wednesday 4th December 2019, the Who’s Who Legal Future Leaders: Competition Conference took place at Freshfields in London.
Global Competition Review’s Emily Craig reported on the panel which discussed getting deals cleared in a post-Brexit UK.
The UK’s competition authority is “really conscious” of balancing the speed of its merger control processes and the public interest, a CMA official said.
Colin Raftery, senior director of mergers and the Competition and Markets Authority, said the enforcer is aware that its merger control process “does not take place in a vacuum” and it has to take into account the views of third parties. Raftery was speaking on a panel last month at Who’s Who Legal Future Leaders: Competition Conference.
In January, the Competition Appeal Tribunal approved an application from UK supermarket chains Sainsbury’s and Asda that challenged the CMA’s Phase II timetable during the enforcer’s review of their £2.98 billion merger. The supermarkets argued that they were not given sufficient time to respond to CMA documentation.
The CAT sided with the supermarket and overturned the authority’s decision to refuse more time to respond. Mr Justice Peter Roth said the timetable was unfair due to the complexity of the deal and the importance of Sainsbury’s and Asda’s response to inform the authority’s decision.
In April, the CMA blocked the deal over concerns it would have caused a substantial lessening of competition and lead to price rises and reduced quality.
Raftery quoted the CAT’s judgment that “the public interest does not benefit if the period in which the inquiry has to be completed is unreasonably compressed”.
He said while the CMA’s review was ongoing at the time of the CAT’s judgment in Sainsbury’s/Asda, there were a “huge number of third parties” – including competitors, customers and suppliers – that “chilled” their investment decisions pending the agency’s review of the tie-up.
The authority is very aware of the need to balance third-party rights and the merging companies’ rights when carrying out its investigation, Raftery said.
The CMA official was responding to a comment from panel-member Julia Cattanach, the chief risk officer at Experian, that speed and certainty are needed in merger control, and “a process that takes a year is not compatible” with this objective.
Raftery said speed is a “really critical” topic for the CMA and conceded that it took almost a year in the Sainsbury’s/Asda case for the authority to issue a final decision. “Merging parties continuously push us for more opportunities and more time, but the price of that is going to be a process that is a bit longer,” Raftery said.
Alison Berridge, a barrister at Monckton Chambers and Simon Chisholm, a vice president at Charles River Associates, were also on the panel.