Outlook: Wonderland logic

THE DEPARTMENT of Trade and Industry was in some difficulty yesterday attempting to explain the inexplicable - why it rejected the chance, offered by Karel van Miert, the EU Competition Commissioner, to claim back jurisdiction over Airtours' bid for First Choice and pack it off to the Competition Commission, where it belongs.

Er, we were following the adviceof the Office of Fair Trading, said a spokesman. More than that, we cannot say because it is commercially confidential. The OFT was a little more forthcoming. We would only advise on claiming it back from Brussels if we thought there was a competition case to answer here in the UK, a spokeswoman explains. So does that mean the OFT thinks there is no competition issue? We're not saying that. Our advice to the Secretary of State has to be confidential.

Two serious points emerge from this nonsense. The first is the need for mergers policy and decision making to be transparent and open. With the apparent exception of the Government and the OFT's John Bridgeman, almost everyone believes allowing Airtours to establish a duopoly of the package holiday market with Thomson would be highly anti-competitive. If the authorities think otherwise, they should explain themselves, regardless of the risk of judicial review.

Second, if the Government refuses jurisdiction when it is offered, what hope of gaining it when Brussels is less inclined to let go? A recent instance of this was the disgraceful episode of Electricite de France's unconditional bid for London Electricity, which both technically and logically, should never have been positively vetted by Brussels. This is a government which is meant to be pro-competition. There's not much evidence of it in this decision.

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