The UK Competition and Markets Authority (CMA) has today published a provisional decision releasing the undertakings affecting FirstGroup’s bus business across southern and central Scotland. The undertakings given currently limit the fares that FirstGroup can charge and require the company to maintain a minimum level of service in some areas. They also govern some aspects of how FirstGroup schedules its services. Frontier Economics advised FirstGroup throughout the CMA’s investigation.
The undertakings were given following the Monopolies and Mergers Commission’s (MMC) conclusion that the completed acquisition by FirstBus plc (now FirstGroup) of SB Holdings Limited (SBH), which took place in 1996, created a merger situation which may be expected to operate against the public interest. The undertakings specifically apply to services operated by FirstGroup across the ‘First Edinburgh’ and ‘First Glasgow’ areas, where FirstGroup operates approximately 255 tendered and commercial routes.
Independent CMA panel members carrying out the review found that the main competitors of FirstGroup were undeterred by the size of FirstGroup from expanding in or entering an area. Given this finding, the CMA provisionally concluded that the undertakings were no longer needed to address the MMC’s concerns.
Frontier regularly advices clients on mergers, transport and competition issues.
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