For announcement of referral see OFT Press Notice PN06/04
Proposed acquistion by Firstgroup plc of the Scotrail
franchise
Terms of reference
1. Whereas in exercise of its duty under section 33(1) of
the Enterprise Act 2002 (“the Act”) to make a
reference to the Competition Commission (“the Commission”)
in relation to an anticipated merger the Office of Fair Trading
(“the OFT”) believes that it is or may be the
case that-
(a) arrangements are in progress or contemplation which,
if carried into effect, will result in the creation of a relevant
merger situation in that:
(i) FirstGroup plc will acquire the Scottish Passenger
Rail Franchise currently operated by ScotRail Railways Limited
such that the Scottish Passenger Rail Franchise will cease
to be distinct from enterprises carried on by or under the
control of FirstGroup plc; and
(ii) the value of the turnover in the United Kingdom of
the enterprise being taken over exceeds £70 million;
and
(b) the creation of that situation may be expected to result
in a substantial lessening of competition within any market
or markets in the United Kingdom for goods or services, namely
the supply of passenger transport services on point-to-point
routes in Scotland.
2. Now, therefore, the OFT, in exercise of its duty under
section 33 of the Act and its power under section 36(5) of
the Act, hereby refers to the Commission, for investigation
and report within a period ending on 28 June 2004, the following
questions in accordance with section 36 of the Act-
(a) whether arrangements are in progress or contemplation
as described in paragraph 1 which, if carried into effect,
will result in the creation of a relevant merger situation;
and
(b) if so, whether the creation of that situation may be
expected to result in a substantial lessening of competition
within any market or markets in the United Kingdom.
3. In relation to the question whether a relevant merger
situation will be created, the Commission shall exclude from
consideration one of the subsections (1) and (2) of section
23 of the Act if they find that the other is satisfied.
John Vickers
Chairman, Office of Fair Trading
13 January 2004
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