ABSTRACT
Over the years there were a number of criticisms of the Fair Trading Act 1973 and its merger control system. The system of referral, based on the exclusive power of the Secretary of State to refer mergers, was criticised as being political. The broad scope of the public interest test, under s 84, was also criticised together with the length of time taken by and the inconvenience of Commission public interest inquiries. There were a number of reports which considered possible reforms of the merger control provisions. The Liesner Report, in 1978, recommended the retention of the case by case basis of merger control, but also recommended that a more critical stance should be adopted towards mergers, in contrast with the presumption that mergers were beneficial.132 No alterations were made to the 1973 Act as a result of the report. The Trade and Industry Committee report in 1991133 followed upon the earlier government publication, in 1988, of a Blue Paper on mergers policy, which stressed that most mergers would be left to the market to decide if they proceeded and competition issues were to be accorded primacy under the system.134 Important modifications were subsequently introduced by the Companies Act 1989 and the Deregulation and Contracting Out Act 1994. The introduction of undertakings in lieu and a statutory notification procedure were significant procedural changes.135 The Competition Act 1998 contained no provisions directly relating to merger control, the traditional public interest investigation system being retained under the 1973 Act. However, the DTI issued a consultation document on proposals for reform, in August 1999,136 and this was followed by the DTI’s October 2000 document, The Response to the Consultation on Proposals for Reform, which endorsed the main proposals in the earlier document.137
