Tuesday, April 22, 2008

British antitrust takes off

The Office of Fair Trading is beefing up cartel enforcement with an investigation of bid-rigging in the construction industry:
The OFT's recent run of heavy-duty cartel-breaking reflects two changes. The first is that it has moved from investigating lots of little cases to pouring its resources into fewer high-profile cases that will serve as examples. The second is that the watchdog is beginning to benefit from the American-style trust-busting powers it was given in 2003: these allow it to bring criminal charges against price-fixers while offering amnesty to whistleblowers. “Deterrence is the key,” says John Fingleton, the head of the OFT. “People only go for leniency if they think there is a chance of them being caught and if the penalty is severe.”
...and the Competition Commission (it sits "over" the OFT in the British system) is contemplating the break-up of BAA, which owns four airports in Britain.
...the prognosis for BAA is not good. The company has three Scottish airports—Glasgow, Edinburgh and Aberdeen—and four in England—Heathrow, Gatwick, Stansted and Southampton—and the Competition Commission says there is potential for competition at all of them.

The commission finds particular fault with the situation in south-east England, where BAA serves 91% of passengers.

Our current view is that at the south-east airports BAA currently shows a lack of responsiveness to the interests of airlines and passengers that we would not expect to see in a business competing in a well functioning market.

1 comment:

  1. Not Britisah Airways, but BAA, the airport company.