OFT derails FirstGroup's franchise bid in Scotland
Wednesday 14 January 2004
FirstGroup reacted with dismay yesterday to a decision by the Office of Fair Trading to refer its bid for the Scottish rail franchise to the Competition Commission.
The transport company said it would now consider pulling out of the bidding process given the uncertainties and delays that a referral to the Competition Commission involves.
The OFT cited fears that FirstGroup, which already operates bus services in Scottish cities such as Glasgow, would damage competition in passenger transport services if it won the rail franchise. However, the company dismissed the OFT's findings and said the competition watchdog was acting "strangely" to come out with its decision at such a late stage. A preferred bidder is expected to be named in the next two to three months.
The OFT's decision effectively rules FirstGroup out of the bidding because an investigation by the Competition Commission would not be completed before the franchise is awarded by the Strategic Rail Authority in the summer.
The move by the OFT leaves just two bidders in the running for the ScotRail franchise; National Express, the incumbent operator, and Arriva. John Vickers, the chairman of the OFT, said: "Significant concern has been expressed that this merger may reduce consumer choice of passenger transport services in Scotland and lessen competition. The evidence currently available is not sufficient for the OFT to be able confidently to reject that view."
The SRA said it would be disappointed if any of the three bidders for ScotRail were to pull out of the process but said it was up to the bidders themselves to obtain clearance from the competition authorities for their bids.
Moir Lockhead, FirstGroup's chief executive, said: "This is disappointing news not just for us but for passengers too....We believe the evidence we put to the OFT shows that buses and trains operate in complementary markets under separate regulatory regimes. No competition issues arise here."
Mr Lockhead pointed out that its bus services in Glasgow faced competition from rival operators on 60 per cent of its routes.
- 1 Games of Thrones actor Lena Headey makes emotional promise to her unborn daughter
- 2 Isis burns woman alive for refusing to engage in 'extreme' sex act, UN says
- 3 Puerto Rico, island of lost dreams: People are leaving the debt-hit territory in droves as near neighbour Cuba's star rises
- 4 Female Muay Thai champion hustles coaches to give them a beating
- 5 16-year-old girl beaten and burned alive by lynch mob in Rio Bravo, Guatemala
Isis burns woman alive for refusing to engage in 'extreme' sex act, UN says
Purity balls: Girls in the US making virginity pledges as fathers vow to 'protect purity'
Female Muay Thai champion hustles coaches to give them a beating
Puerto Rico, island of lost dreams: People are leaving the debt-hit territory in droves as near neighbour Cuba's star rises
16-year-old girl beaten and burned alive by lynch mob in Rio Bravo, Guatemala
As a white man, I'm surprised more women aren't tweeting the hashtag #KillAllWhiteMen
Scotland may have to leave the EU even if it votes to stay in, David Cameron confirms
Report finds that Britain's wages are the most unequal in Europe
The day that Britain resigned as a global power
Almost a third of school pupils believe 'Muslims are taking over our country', study claims
SNP fury as HS2 finds 'no business case' for taking fast train service to Scotland
iJobs Money & Business
£40-50K: Guru Careers: We are seeking an experienced Software / C# Developer w...
£45,000 - £55,000: Neil Pavier: Are you looking for your next opportunity for ...
£45,000 - £55,000: Sheridan Maine: Are you a newly qualified ACA/ACCA/ACMA qua...
£50,000 - £60,000: Laura Norton: Are you looking for an opportunity within a w...