The group of independent Competition and Markets Authority (CMA) panel members carrying out the review have found that the undertakings are no longer appropriate due to a change in circumstances.
The CMA announced in October that it would carry out a review of the undertakings given in relation to the completed acquisition by FirstBus plc of SB Holdings Ltd (SBH) in 1996. FirstBus changed its name to FirstGroup in 1997.
Further details, including the CMA’s final decision and notice of release from undertakings, can be found on the case page.
Notes for editors
The CMA is the UK’s primary competition and consumer authority. It is an independent non-ministerial government department with responsibility for carrying out investigations into mergers, markets and the regulated industries and enforcing competition and consumer law.
The undertakings, affecting FirstGroup’s bus business, were given by FirstGroup to the then Secretary of State for Trade and Industry in 2002 following a review in 1997 by the Monopolies and Mergers Commission of the FirstBus acquisition of SBH. The undertakings were subsequently varied following the Competition Commission’s review of the undertakings in 2008.
The fares cap applies to FirstGroup operations in the First Edinburgh and First Glasgow areas. The First Edinburgh area comprises the unitary authorities of Stirling, Clackmannanshire, Falkirk, West Lothian, Midlothian, East Lothian and the Scottish Borders. The First Glasgow area comprises the unitary authorities of the City of Glasgow, North Lanarkshire, South Lanarkshire, East Dunbartonshire, West Dunbartonshire and East Renfrewshire. The requirement to operate a minimum level of service also known as the ‘mileage floor’ applies to FirstGroup operations in the First Edinburgh area. The price cap and mileage floor do not extend to Edinburgh.
The CMA has the ability to supersede, vary or release certain undertakings accepted under the Fair Trading Act 1973; this includes the FirstGroup undertakings. This power is exercisable in the same circumstances, and on the same terms and conditions as applied to the Secretary of State under the Fair Trading Act 1973; namely that by reason of any change of circumstances the undertakings are no longer appropriate and need to be varied, superseded or released.