Clause 21 - Relevant merger situations
Enterprise Bill
4:30 pm
Mr Jonathan Djanogly (Huntingdon, Conservative)
I beg to move amendment No. 215, in page 11, line 46, leave out '45' and insert '70'.
The concept of a de minimis threshold is, of course, vital to the process of the competition regime to avoid clogging up the workings of the OFT, stopping small businesses doing what they have to do and submitting such businesses to unnecessary regulations. Those provisions are not in place to stop businesses competing against one another. Indeed, it is quite the opposite: they are here to ensure that competition is encouraged in such a way that consumers and other businesses are not hurt.
How did the Government arrive at the figure of £45 million to be used as a de minimis? I would also be grateful if the Under-Secretary would give comparisons with other countries, as those are relevant to what happens in this country. We should
also appreciate that the regime under discussion is already being used in other countries. The £45 million figure seems very low, particularly when one considers the 25 per cent. market test in the Bill. In large markets where many competitors do not come within the 25 per cent. market share, mergers could nevertheless be dragged into the regime in circumstances where it was not a relevant issue.
The CBI has suggested that the figure be raised from £45 million to £70 million. I do not know how scientific that figure is, although it does come from an organisation that has a lot of experience because its members are subject to the competition regime, and is therefore worthy of proper consideration. I would finally note that clause 26 provides for the Government to change the figure if necessary.
It is important that we have a figure at the outset that is acceptable to business, as well as appropriate to the regime, in order that the system is fair and transparent.