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Lipworth calls for new EC competition body

SIR Sidney Lipworth, chairman of the Monopolies and Mergers Commission, has called for radical changes in the handling of competition issues in the European Community.

Sir Sidney told a London legal conference that an independent body, outside the European Commission, should adjudicate on mergers and other competition matters. He also urged the Commission to be less secretive in its dealings, saying it should publish full reports of detailed competition inquiries and their findings.

Sir Sidney said the EC should adopt a UK approach, in which a body such as the Office of Fair Trading carries out investigations and decides whether something is against the public interest before handing over to the Monopolies and Mergers Commission. A separate body, akin to the MMC, should then adjudicate and make a recommendation to the EC.

Sir Bryan Carsberg, director- general of the OFT, later welcomed the idea of an independent European competition body. He added that such an approach had also been mooted by competition authorities in Germany.

Sir Sidney said: 'If officials decide whether a full-scale investigation should proceed then a different body should carry out that investigation and decide what should be done. That would be the fairest way to proceed into the 21st century.'

Sir Sidney said that while his ideal would be an organisation independent of the European Commission, if this could not be done, the two functions should be kept at arm's length from each other.

However, his ideas were attacked by Claus Peter Ehlermann, director-general of the EC's competition directorate, who said that they would make procedures too complicated.

Sir Sidney also said that although EC competition laws were sound, there were areas such as financial services where competition policy might clash with other regulatory objectives.

He went on to warn that more must be done to increase competition in the public sector. In particular, state aid and subsidies should be reduced.

Sir Sidney said there was no need for EC states to have identical competition rules as long as they were compatible with EC regulations and did not discriminate against other EC residents.