The UK Competition and Markets Authority (CMA) has today cleared the award of the TransPennine Express rail franchise to First TransPennine Express Limited, a subsidiary of FirstGroup. Frontier Economics advised FirstGroup on the competition impact of the Franchise award.
The CMA examined overlaps with other rail services and determined that the franchise does not give rise to a realistic prospect of a substantial lessening of competition (SLC). This is primarily because of the competition provided by Northern Rail on the line between Selby and Hull.
In terms of competition between rail and bus services, the CMA could not rule out that the franchise award may result in an SLC between Huddersfield and Marsden where FirstGroup’s combined bus services and rail franchise would represent a very high share of public transport services. However, the CMA has exercised its discretion to apply the ‘de minimis’ exception where small markets are affected, and has not referred the franchise award for an in-depth investigation.
Frontier regularly advices companies and regulators on mergers, transport and competition issues.
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