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Competition policy in Britain: Retrospect and prospect
International Review of L a w and Economics (1982), 2 (139-149)
© 1982 Butterworths
COMPETITION POLICY IN BRITAIN: RETROSPECT AND PROSPECT SIR GORDON BORRIE*
Office o f Fair Trading, Field House, Breams Buildings, London EC4, England INTRODUCTION
The term 'competition policy' might suggest a high degree of coherence of philosophy and of instruments for implementation, worked out and developed according to some carefully systematic plan. I must at once disclaim any intention on my part to give the impression that this is so. In fact UK competition policy has grown, if not exactly like Topsy, then at least unevenly in response to the political preoccupations of the day and in the light of changing economic thought and experience. What began as a relatively simple attempt to control monopolies and cartels in 1948, I through enquiry by the Monopolies Commission followed by Government decision, developed by hiving off cartels to be examined instead by a judicial process as from 1956, 2 and by starting a process of controlling mergers and take-over bids in 1965. 3 Then came the creation of the Office of Fair Trading as the principal initiating body in 1973, 4 the extension of the cartel law from goods to services in 1976: and finally some supplementary powers to investigate more speedily the anticompetitive behaviour of individual firms by the Competition Act 1980. This process of growth has left behind it a varied mixture of procedures and practices whose justification lies in the fact that they seem to work rather than in any underlying unity of approach. And there is a further justification for this untidy and seemingly unplanned construction of one piece of legislation upon another because over the years the changing economic scene combined with actual experience of existing procedures suggested that improvements and amendments were needed rather than wholesale replacement. Of course, it may be that those of us closely involved with competition policy are always liable to be too much aware of the diversity of approaches in different countries and, within any one country, of different approaches at different times, to place a great deal of emphasis on the need for philosophical consistency. We are also often the object of well argued special pleading to the effect that, whatever the general virtues of promoting competition, those virtues should not apply in these or those circumstances or at this or that time. In looking back, and in looking forward, I shall be developing a number of different lines of thought. One is that there is some semblance of a common theme in UK competition policy; and there are more common elements in the experience of different countries than might appear at first sight. Another thought is that there are good reasons for * This article is a revised version of the R. W. Mann Productivity Lecture delivered at the University of Newcastle upon Tyne in February 1982. Sir Gordon Borrie is Director General of Fair Trading.
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looking sceptically at any claim for temporary dispensation from an effective competition policy. I. A DEFINITION OF C O M P E T I T I O N First, I must try to define what I understand by 'competition'. This is surprisingly difficult. It is easy enough to find a definition of what competition is supposed to do. For example, in the Government's Green Paper of 1978, 6 sometimes referred to as the Liesner Report, the following is said: Economists generally hold that economic welfare is promoted by competition as it encourages cost minimisation, technical progressiveness and the allocation of resources in line with the wishes of consumers. Sir Keith Joseph when he was Secretary of State for Industry, emphasised that it was competition which forced producers to give value for money: It is competition in pursuit of profit but at the risk of loss which harnesses the self-interest of people as producers to the interests of people as consumers. 7 Adam Smith--a great economist because he also had a sound understanding of human nature--called competition 'striving for patronage' which might be translated for the 1980s as 'striving for customers'. His definition prompts two reflections: .
Competition requires consumer knowledge of what is available in the market and willingness and keenness on the part of businessmen to compete. Consumer choice and healthy competition are interdependent. The more sophisticated and rational the consumer, and the more he is provided positively with helpful information to assist choice, the more likely it is that competition will be vigorous. Vigorous competition includes making the customer aware of what is available. In the past year or so, many people in Britain have been complaining of the high mark-up of spectacle frames available privately in opticians' shops. One aspect, which I am engaged in reviewing, is the monopoly that registered opticians have under the Opticians Act 1958 in the sale of optical appliances. But I am also concerned about the restrictions imposed by the General Optical Council on opticians over the advertising of their prices. Clearly the absence of price information is always likely to blunt the sharp edge of competition. But even if there is the maximum of clear information available to consumers, competition may be sluggish because of the lack of real will on the part of potential competitors to compete. In the last 20 years, businessmen seem to have become much more conscious that it is in their own interest to seek out what consumers want and to provide them with more information for the making of effective choices. But I do not think they have become addicts of competition when alternative ways of doing business are open to them. The most obvious sign of such resistance is the number of occasions in recent years when my Office has uncovered secret price fixing agreements--in such diverse fields as telephone cables, bread, polyester resin, and the construction industry.
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However, I want to mention a more subtle point--Government intervention may be able to clear away the restrictions on competition that are constituted by cartels and various kinds of anti-competitive practices; but it cannot compel businessmen to compete if they do not wish to do so. A restrictive trading agreement that was submitted to us a few years ago by the Scottish Clearing Banks was their agreement as to the hours at which their branch banks will open. After discussion with us about that, among various other restrictions, they agreed to give up the restriction; but the removal of restrictive agreements can only ensure there is freedom to compete. It cannot compel competition. Each Scottish bank is free now to decide at what hours it opens, but I have not heard that any has actually used its new found freedom to behave competitively in the matter of opening hours. Clearly the absence of restraints on competition does not necessarily mean a highly competitive environment. Competition policy cannot make people compete--it can only create the conditions in which they are able to do so. Any bank which was willing to provide cheque cards for more than £50, an amount which inflation has made a rather modest limit since it was established five years ago, would no doubt attract a lot of custom; but no bank seems willing to step out of line with its competitors. Competition can be too successful for the public good in the longer term. Competition is a dynamic process with unpredictable consequences. One possibility is that competition is so intense and price wars so fierce that even the efficient may go to the wall. Another possibility, once you have created conditions in which competition can flourish, is that there may emerge one or more competitors able to establish themselves in a monopoly position which will then call for further attention on the part of the competition authorities. No one wants to penalise success in the competitive market place but if success leads to the exploitation of monopoly profit or the deliberate barring of the way to new rivals, intervention is justified in the public interest. II. T H E BASIS OF COMPETITION POLICY
So, let us get to the basics of competition policy and its justification. Competition policy comprises the Government's intervention in the free play of market forces, an intervention that is justified because left to themselves market forces can destroy competition and strangle enterprise. I do not think many nowadays would disagree that in a modern, developed market economy the State must have a purposeful policy towards competition, or rather towards the many circumstances in which competition is absent or ineffective. As Sir Geoffrey Howe said, in introducing the Fair Trading Bill, the freedom that the market economy provides 'may be used to concentrate power, to limit competition and may be used in ways contrary to the public interest'.8 The recognition over a period in excess of 30 years in the UK that the Government has a responsibility to promote competition both as a spur to efficiency and as an integral part of industrial policy generally provides a common refrain through all the various developments and changes in policy to which I have referred. The other common refrain is that the promotion of competition is not an end in itself, and that any restrictions on competition that may exist must always be judged against a broad criterion of the 'public interest'. This is a difficult and controversial concept, as I shall illustrate, but its pre-eminence ensures that, in the UK, competition policy
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can never become an inflexible dogma. As I have already indicated, competition policy has to recognise that the competitive process itself produces responses which may have anti-competitive consequences. It must be concerned with what is happening in markets and what may happen. Put another way, it must be concerned with monopolies and cartels, with mergers and with anti-competitive conduct. Let me take these in turn. .
It is concerned with the possible abuse of market power, by which single firms (monopolies) or groups of firms (cartels) escape the disciplines of competition, irrespective of whether such firms have built up their power by fair means or foul. Being a monopoly is one thing--taking advantage of monopoly power is another. In the words of Shakespeare: O! it is excellent To have a giant's strength, but it is tyrannous To use it like a giant. 9 One multinational company, Hoffman-La-Roche, has been the subject of scrutiny by both national competition authorities and by the EEC. In 1973, the UK Monopolies Commission, having conducted an exhaustive examination into the pricing policies of the company for the supply of the well-known tranquillisers, Librium and Valium, in which they had a 99 per cent monopoly, concluded that their UK prices had been manifestly too high for some years and that they had obtained in consequence excessive monopoly profits. 1° The Government ordered them to reduce their prices by a considerable margin and to repay large sums to the National Health Service for excessive prices already charged. In 1976 the EEC Commission found that Roche had abused its dominant position in the markets for various categories of vitamins by entering into exclusive or preferential supply agreements with major industrial buyers that provided for fidelity rebates so calculated as to induce them to obtain all or virtually all their requirements from Roche. ~1 The European Court later confirmed the Commission's view and asserted that such conduct was incompatible with undistorted competition because it restricted the purchaser's scope for choice and raised barriers to market entry by other producers. 12 . Competition policy is concerned with structural trends and changes in ownership which may create or intensify market power (i.e. mergers), a recent example being the proposed European Ferries/Sealink merger which would have created, if it had been effected, a 70 per cent monopoly on the short cross-channel routes to France. . Competition policy is concerned with the behaviour of firms, whether in oligopolitistic markets, or alone, which, whether or not technically monopolists, are nevertheless in a dominant position. Under the Competition Act 1980, I am enabled to carry out an investigation into any course of conduct if I think it may amount to an anti-competitive practice. Examples of such conduct could be exclusive dealing arrangements, tie in sales, predatory pricing and a manufacturer's selective distribution system.
My first investigation under these new powers was into Raleigh's system of supplying its bicycles selectively to certain types of retailer only. My conclusion was that the company's 45 per cent share of the bicycle market and the brand loyalty
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which Raleigh bicycles commanded were such that the company's refusal to supply certain multiple retailers could adversely affect competition as between different types of retailer and deprive the public of potentially lower prices. ~3 To my mind there was here an anti-competitive practice and later the Monopolies and Mergers Commission agreed with that view and added that it was contrary to the public interest for it to continue. 14 III. C O M P E T I T I O N POLICY WITHIN THE USA I want now to draw some comparisons between the growth and experience of competition policy in the USA and that in the UK. Of course, much of the American experience is a response to peculiarly American conditions and concerns, and that must always be borne in mind. But there is also much of interest there from which British and European authorities and business can benefit. I fully endorse Edward Gibbon's comment in his Decline and Fall o f the Roman Empire In all the pursuits of active and speculative life, the emulation of states and individuals is the most powerful spring of the efforts and improvements of mankind. Competition policy arose in the USA in response to the consequences of emulation between individuals; and as competition policy spread to the UK somewhat later, it may be regarded as a good example of emulation between states. Any discussion of competition policy must make some sort of a bow in the direction of the USA because of that country's long experience--nearly a hundred years. The origin of US anti-trust policy lay in the vigorous--almost explosive--economic growth in the second half of the 19th century. This growth took place in a market almost untouched by government regulation, and one consequence was the rapid development of monopoly situations and accompanying anti-competitive practices which threatened to strangle the very market freedom upon which growth had been based. A widespread feeling that the power conferred by monopoly was unacceptable not just in economic, but also in political terms, was a powerful incentive towards the passage of the early anti-trust legislation. The need to restrain untrammelled economic power was seen as a constitutional requirement as much as an economic one.
The American approach relied on legal and judicial process and, until the present, at least, on the predominance of law over economics. Historical and cultural traditions thus led to a greater dependence on per se prohibitions and a rigorous attitude towards horizontal mergers, i.e. mergers between companies supplying the same goods or services. Why does anti-trust, as competition policy is usually termed in the USA, seem to have found such ready acceptance ever since the Sherman Act 1890? One can identify a number of factors. One has been the general confidence of Americans in the vigour and success of their economy. Another has been the more philosophical feeling, well expressed in the Massachusetts Bill of Rights, that there should be 'a government of laws and not of men'. There is also in the USA a lower level of confidence in consensus politics and a strong vein of distrust of 'big business'. Although the emphasis may change (as indeed it has done under the present Administration) there is no sign of any questioning of the need for an anti-trust policy. As a result, industry and commerce in the USA build into their planning:
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anti-trust considerations--they and their teams of in-house lawyers take full account of the existing judicial precedents and the likely attitude of the Department of Justice and the Federal Trade Commission to their activities. IV. COMPETITION POLICY IN THE U N I T E D KINGDOM Competition has not always been held to be especially virtuous in the United Kingdom. Let me quote, for example, from the MacMillan Committee on Finance and Industry in 1931: It has been represented to us strongly in evidence that a great deal remains to be done in more than one important industry in overcoming sectional and individual opposition to desirable amalgamations and reconstructions designed to eliminate waste and cheapen costs. It was stated to us that very important economies and much greater efficiency are possible if there are concerted movements to that end. We believe this to be the case . . . . 15 There was a change in attitude during the war, partly as a result of the impact of Keynes, partly through public disquiet about restrictive trading agreements, partly through a sense that the trading patterns of imperial preference were over and that we were thrown back more and more upon our own resources. The consequence was the 1948 Monopolies and Restrictive Practices Act--the first piece of UK anti-trust legislation. In many ways, this was characteristically British, reflecting our different cultural traditions and, in particular, the strong disposition in the UK to avoid conflict and legalism. There were no p e r se prohibitidns. Instead, nothing could be prohibited unless the newly created Monopolies Commission condemned the agreement or practice and the Government chose to follow its recommendations. That first piece of UK legislation had, as Professor Rowley has said, 'its fair share of faults' but that few problems have arisen in respect of its scope is itself, he added, 'a tribute to those responsible for it'.~6 UK legislation had built into it from the start the concept that the ultimate objective was the public interest, and that by implication competition policy should be regarded as a means to this wider end. Although the precise wording of the legislation varies, all UK competition law, whether it deals with monopolies, mergers, restrictive trading agreements or anti-competitive behaviour, requires a case-by-case approach to decide whether or not a particular situation or course of conduct is contrary to the public interest. UK competition policy must always be seen in this context. The early reports of the Monopolies Commission (set up by the 1948 Act) were concerned primarily with cartels; and the experience of the Commission in the early 1950s, after examining various cartel arrangements, convinced it that they must almost always be against the public interest. This led to the Restrictive Trade Practices Act 1956 which created the Office of the Registrar of Restrictive Trading Agreements and the Restrictive Practices Court to deal with agreements between companies relating to the supply or production of goods in the UK. Thus was established the twin pillars of UK competition policy: the judicial system and the administrative or discretionary system. The judicial system has operated in the case of restrictive trading agreements or cartel agreements in the field of goods since 1956. Here, the presumption is that all such agreements are contrary to the public interest but the Court may allow them, provided that exceptionally they can be justified in the terms of the so-called 'gateways.' in the Act and that there is a balance
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of advantage over detriment. Similar procedures and provisions were established in 1964 for resale price maintenance 17 (the nearest thing to a per se prohibition in UK competition policy) and the provisions of the Restrictive Trade Practices Act were extended to services in 1976. V. DISCRETION AND THE ADMINISTRATIVE SYSTEM The administrative system continues for all other aspects of competition policy. Monopolies and, since 1965, mergers are not subject to any rule that they are per se or even p r i m a facie a bad thing. Rather they are subject to a discretionary power in the Government to initiate an enquiry by the Monopolies and Mergers Commission to determine the public interest, and a further discretionary power in the Government to act upon the Monopolies and Mergers Commission's recommendations. The administrative system has been further developed by the Competition Act 1980. My own post was created in 1973 and my Office now has the main initiating role both within the judicial system by taking cartel agreements to the Court for judgment and within the discretionary system by taking monopoly and anticompetitive practice problems to the Monopolies and Mergers Commission and advising Ministers on whether particular mergers should go to the Monopolies and Mergers Commission. Professor O'Brien of the University of Durham wrote a paper last year on 'Competition Policy in Britain' in which he said that since 1973 'a silent revolution' in the operation of competition policy had occurred so that the predominantly legalistic approach (through the Restrictive Practices Court) had been 'supplanted' by the development of an administrative and discretionary procedure. 18 He added that British policy seems to have evolved silently to the point where, on the basis of the legal foundations, the future thrust of policy will be along administrative and discretionary lines. I do not know whether by expressly agreeing with Professor O'Brien the revolution becomes less of a silent one; but I think he is right in both his analysis and his prognosis though I would add that the Restrictive Practices Court is going to have to give judgments in the near future on a number of important restrictive trading agreements relating to services, including the exclusive dealing agreement of ABTA, and the fixed commission restrictions of the Stock Exchange. So the Court still has a useful active life ahead. But perhaps Professor O'Brien is more percipient than he realised, because even within the judicial system, a limited but nonetheless important discretionary element exists. Although I have a general duty to take before the Court all restrictive trading agreements that have been registered, I have a discretion (with the Secretary of State for Trade's agreement) to refrain from going to Court if the restrictions are not of such significance as to call for investigation by the Court. I have made it known that all agreements are considered with the possibility of this discretion being exercised and in many cases, no doubt with the severity of the Court's judgment in earlier cases in mind, parties to agreements are prepared to modify them and to dismantle restrictions embodied in them in order that no 'significant' restrictions remain. So it is, therefore, that trade association agreements, recommending to their members standard terms of contract on which they should do business, may not have to go to the Court if they appear to the Office to be fair to both sides, to be not
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misleading and to allow for suitable variation in exceptional circumstances. A number of joint ventures thus have been given the green light where the restrictions are no more than necessary for the joint venture. On close examination, restrictive agreements may in fact turn out to be pro-competitive rather than anti-competitive, e.g. arrangements (like franchise agreements and buying groups of retailers) that allow new businesses or small businesses to compete more effectively against established businesses than would be possible alone, and where the restrictions on competing with one another are essential to that pro-competitive effect of the agreement. Where there is a large element of discretion in policy, there must also be a large degree of unpredictability and that is a charge often levied by business against the operation of competition policy in Britain, particularly perhaps in its application to mergers. But I have just shown that even in the field of restrictive trading agreements, where even 25 years ago there was a general consensus that only exceptionally could they be justified as being in the public interest, we have moved towards a greater discretion because there is so often a need to balance the anti-competitive features with features that are pro-competitive or otherwise in the public interest. There is no consensus that all or most mergers are undesirable and, although there may be argument as to whether present policy is too benign towards them, we must surely continue to have a system that does its best to weigh up the pros and cons. US law, on the face of it, is much more predictable than ours, and much more inflexible. The Sherman Act states that all combinations in restraint of trade are hereby declared illegal and anyone attempting to monopolise any part of trade or commerce shall be guilty of a misdemeanour. But the Americans too, modifying the p e r se prohibition of the Act by a so-called rule of reason, have moved towards a greater flexibility. The net result is that similar trading practices are often treated similarly by the authorities in our two countries and this is so despite the fact that the USA depends a great deal more on the judicial process than we do. Thus in the Sylvania case, ~9in 1977, the US Supreme Court ruled that a very rigid exclusive distribution network operated by a manufacturer of TV sets, whereby dealers were forbidden to sell outside their own territories, was not anti-competitive because the company concerned had only a small market share--some five per cent - - a n d any restriction on intra-brand competition was outweighed by the increase in competition between the company's brand and its competitors' which arose because the restrictions gave Sylvania's retailers powerful incentives for investment and promotion of the product. Here in the UK, by contrast, I concluded in the Raleigh case2°--and the Monopolies and Mergers Commission agreed--that in view of Raleigh's dominant position in the market the company's selective distribution system amounted to a significant restriction on intra-brand competition without doing anything to increase competition with brands other than Raleigh's. I see no inconsistency between those two cases--they both show that it is a matter of balancing the pro-competitive features of the business practice against the anticompetitive features. My other example is drawn from the treatment of attempts to maintain a local "monopoly. In the Lorain Journal case 21 in 1951, a local newspaper in Ohio sought to put a local radio station out of business (and thereby retain its monopoly of local advertising) by refusing to accept advertisements from anybody who advertised on local radio. This conduct was condemned by the Supreme Court as a clear attempt to maintain its local advertising monopoly. In the UK, very similar behaviour by Sheffield Newspapers Ltd (though this time in relation to competition from a free
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newspaper rather than a radio station) was found by me to be anti-competitive in a recent report under the Competition Act. 22 The company concerned gave undertakings regarding part of their course of conduct, and the rest is now being investigated by the Monopolies and Mergers Commission. VI. THE FUTURE The present may not seem a good time for competition policy. As is inevitable during a recession, powerful voices are raised demanding protection; and there is pressure to try to safeguard jobs in the short term at the expense of long term efficiency. Nevertheless, in times of recession competition policy becomes, in my view, more rather than less important, since it is a vital instrument in the promotion of efficiency and in facilitating the process of adjustment to changed economic circumstances, without which recovery from the recession can only be further delayed. (The experience of the last 50 years demonstrates all too clearly that to try to isolate UK industry from world trends leads to greater hardship in the end--as witness the experience of our shipbuilding, steel and motor vehicle industries.) It is also easier to allow anti-competitive practices to develop than to get rid of them when they are established, even when more buoyant economic conditions arrive, and the case for a Government competition policy in the interests of increasing freedom and encouraging entrepreneurship remains as strong as ever. Without it, in the end, the consumer pays. Nevertheless, our policy must, of course, remain flexible. In times of recession, in particular, the conflict between fairness and efficiency is likely to be particularly acute, and too much emphasis on efficiency may in the long run be self-defeating if the gains (e.g. from economies of scale) lead to the establishment of oligopolies and an eventual reduction in the level of competition. We need also to take account of factors little regarded 10 years ago, such as our relationship with Europe and the increasing internationalisation of manufacturing industry. I endorse the view that we need to place more emphasis on the service sector (including the professions which have contributed to the institutional inertia that has made it more difficult to secure essential changes in tile UK). We shall need to continue to develop the use of the mix of different procedures--judicial and administrative--that has been built up over the years. One of the encouraging signs is that, just as in the USA for a very long time now business has taken account of competition policy in making its plans and trading arrangements, British business too is much more aware of how competition policy may impact upon them. My Office has always been ready to discuss merger proposals informally and confidentially with businessmen and their merchant bankers. Indeed, my policy is to run an 'open' office so that industrialists and traders can discuss with us any matter where competition policy may be relevant to their problems. British firms may not employ so many in-house lawyers as would equivalent US companies; but their numbers have risen and private firms of solicitors too are increasingly advising businessmen of the implications of competition legislation. Clearly, a growing understanding among businessmen and their advisers means that competition policy has a greater effect on decision-making in business than is seen by merely looking at the public manifestations of competition policy shown by the references to the Monopolies and Mergers Commission and to the Restrictive Practices Court. Of course, it is important to keep in perspective what active competition policy
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can achieve, and remember that it is only a means to an end, and that at the end of the day the public interest must be over-ridingwI would instance as a recent example the Monopolies and Mergers Commission's conclusion on the bids for the Royal Bank of Scotland, where though there were good arguments for both bids, in terms of promoting competition in the banking world, the Monopolies and Mergers Commission was of the opinion that on wider public interest grounds the Bank should retain its independence. 23 The fact that the Monopolies and Mergers Commission report contains two notes of dissent, and has been subject to considerable controversy demonstrates that the concept of 'public interest' is one that is open to a variety of interpretations. But although there may b e argument over who or what kind o f body should make such judgments, surely no one denies that some such notion of public interest must remain. And it is, I believe, important to maintain a climate within which commerce and industry regard the competitive process as normal, accept competition policy as a means of ensuring that it is maintained and are indeed prepared to take advantage of a more competitive environment. No one suggests that the way ahead for Britain in economic terms is other than difficult. I believe that the will to compete, within a framework whereby Government tries to ensure that such will to compete is not thwarted, is an important ingredient in the economic progress that we all want to see.
REFERENCES AND NOTES 1. Monopolies and Restrictive Practices (Inquiry and Control) Act 1948. 2. Restrictive Trade Practices Act 1956. This Act created the Office of the Registrar of Restrictive Trading Arrangements. The Registrar's function of taking restrictive trading agreements to the Restrictive Practices Court to judge whether they were against the public interest was absorbed into the office of the Director General of Fair Trading when that office was established by the Fair Trading Act 1973. 3. Monopolies and Mergers Act 1965. 4. Fair Trading Act 1973. 5. Restrictive Trade Practices Act 1976. 6. A Review of Monopolies and Mergers Policy. A Consultative Document (Cmnd. 7198), para. 3.1. 7. Speech to Bow Group made in House of Commons on 2 April 1981, reproduced in British Business of 17 April 1981 (page 747, col. 1, para. 1). 8. House of Commons Parliamentary Debates (Hansard), Vol. 848, col. 453 (13 December 1972). 9. Measure for Measure, Act II, Scene 2. 10. Monopolies Commission, A Report on the Supply of Chlordiazepoxide and Diazepam (H.C. 197 of 1972-73). 11. O J L 223 of 16 August 1976. 12. Hoffman-La-Roche & Cie SA, Basle v. Commission 85/76: [1979] ECR 461. 13. TI Raleigh Industries Ltd., A Report by the Director General of Fair Trading, 27 February 1981. 14. Monopolies and Mergers Commission, A Report on Bicycles, 16 December 1981 (H.C. 67 of 1981-82). i 5. Report of the Committee on Finance and Industry (Cmd. 3897) para. 385. 16. Charles K. Rowley, TheBritish Monopolies Commission (1966), p. 80. London: Allen & Unwin. 17. Resale Prices Act 1964. 18. D, P. O'Brien, 'Competition Policy in Britain: The Silent Revolution', (1982) 27 Antitrust Bulletin, pp. 218 and 238.
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Continental T. V. Inc. v. G.T.E. Sylvania Inc. 433 US 36 (1977). See Footnote 13. United States v. Lorain Journal Co. 342 US 143 (1951). Sheffield Newspapers Ltd., A Report by the Director General of Fair Trading, 27 October 1981. 23. Monopolies and Mergers Commission, A Report on Proposed Mergers with the Royal Bank o f Scotland Group Ltd., HMSO, January 1982.
© 1982 Butterworths
COMPETITION POLICY IN BRITAIN: RETROSPECT AND PROSPECT SIR GORDON BORRIE*
Office o f Fair Trading, Field House, Breams Buildings, London EC4, England INTRODUCTION
The term 'competition policy' might suggest a high degree of coherence of philosophy and of instruments for implementation, worked out and developed according to some carefully systematic plan. I must at once disclaim any intention on my part to give the impression that this is so. In fact UK competition policy has grown, if not exactly like Topsy, then at least unevenly in response to the political preoccupations of the day and in the light of changing economic thought and experience. What began as a relatively simple attempt to control monopolies and cartels in 1948, I through enquiry by the Monopolies Commission followed by Government decision, developed by hiving off cartels to be examined instead by a judicial process as from 1956, 2 and by starting a process of controlling mergers and take-over bids in 1965. 3 Then came the creation of the Office of Fair Trading as the principal initiating body in 1973, 4 the extension of the cartel law from goods to services in 1976: and finally some supplementary powers to investigate more speedily the anticompetitive behaviour of individual firms by the Competition Act 1980. This process of growth has left behind it a varied mixture of procedures and practices whose justification lies in the fact that they seem to work rather than in any underlying unity of approach. And there is a further justification for this untidy and seemingly unplanned construction of one piece of legislation upon another because over the years the changing economic scene combined with actual experience of existing procedures suggested that improvements and amendments were needed rather than wholesale replacement. Of course, it may be that those of us closely involved with competition policy are always liable to be too much aware of the diversity of approaches in different countries and, within any one country, of different approaches at different times, to place a great deal of emphasis on the need for philosophical consistency. We are also often the object of well argued special pleading to the effect that, whatever the general virtues of promoting competition, those virtues should not apply in these or those circumstances or at this or that time. In looking back, and in looking forward, I shall be developing a number of different lines of thought. One is that there is some semblance of a common theme in UK competition policy; and there are more common elements in the experience of different countries than might appear at first sight. Another thought is that there are good reasons for * This article is a revised version of the R. W. Mann Productivity Lecture delivered at the University of Newcastle upon Tyne in February 1982. Sir Gordon Borrie is Director General of Fair Trading.
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looking sceptically at any claim for temporary dispensation from an effective competition policy. I. A DEFINITION OF C O M P E T I T I O N First, I must try to define what I understand by 'competition'. This is surprisingly difficult. It is easy enough to find a definition of what competition is supposed to do. For example, in the Government's Green Paper of 1978, 6 sometimes referred to as the Liesner Report, the following is said: Economists generally hold that economic welfare is promoted by competition as it encourages cost minimisation, technical progressiveness and the allocation of resources in line with the wishes of consumers. Sir Keith Joseph when he was Secretary of State for Industry, emphasised that it was competition which forced producers to give value for money: It is competition in pursuit of profit but at the risk of loss which harnesses the self-interest of people as producers to the interests of people as consumers. 7 Adam Smith--a great economist because he also had a sound understanding of human nature--called competition 'striving for patronage' which might be translated for the 1980s as 'striving for customers'. His definition prompts two reflections: .
Competition requires consumer knowledge of what is available in the market and willingness and keenness on the part of businessmen to compete. Consumer choice and healthy competition are interdependent. The more sophisticated and rational the consumer, and the more he is provided positively with helpful information to assist choice, the more likely it is that competition will be vigorous. Vigorous competition includes making the customer aware of what is available. In the past year or so, many people in Britain have been complaining of the high mark-up of spectacle frames available privately in opticians' shops. One aspect, which I am engaged in reviewing, is the monopoly that registered opticians have under the Opticians Act 1958 in the sale of optical appliances. But I am also concerned about the restrictions imposed by the General Optical Council on opticians over the advertising of their prices. Clearly the absence of price information is always likely to blunt the sharp edge of competition. But even if there is the maximum of clear information available to consumers, competition may be sluggish because of the lack of real will on the part of potential competitors to compete. In the last 20 years, businessmen seem to have become much more conscious that it is in their own interest to seek out what consumers want and to provide them with more information for the making of effective choices. But I do not think they have become addicts of competition when alternative ways of doing business are open to them. The most obvious sign of such resistance is the number of occasions in recent years when my Office has uncovered secret price fixing agreements--in such diverse fields as telephone cables, bread, polyester resin, and the construction industry.
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However, I want to mention a more subtle point--Government intervention may be able to clear away the restrictions on competition that are constituted by cartels and various kinds of anti-competitive practices; but it cannot compel businessmen to compete if they do not wish to do so. A restrictive trading agreement that was submitted to us a few years ago by the Scottish Clearing Banks was their agreement as to the hours at which their branch banks will open. After discussion with us about that, among various other restrictions, they agreed to give up the restriction; but the removal of restrictive agreements can only ensure there is freedom to compete. It cannot compel competition. Each Scottish bank is free now to decide at what hours it opens, but I have not heard that any has actually used its new found freedom to behave competitively in the matter of opening hours. Clearly the absence of restraints on competition does not necessarily mean a highly competitive environment. Competition policy cannot make people compete--it can only create the conditions in which they are able to do so. Any bank which was willing to provide cheque cards for more than £50, an amount which inflation has made a rather modest limit since it was established five years ago, would no doubt attract a lot of custom; but no bank seems willing to step out of line with its competitors. Competition can be too successful for the public good in the longer term. Competition is a dynamic process with unpredictable consequences. One possibility is that competition is so intense and price wars so fierce that even the efficient may go to the wall. Another possibility, once you have created conditions in which competition can flourish, is that there may emerge one or more competitors able to establish themselves in a monopoly position which will then call for further attention on the part of the competition authorities. No one wants to penalise success in the competitive market place but if success leads to the exploitation of monopoly profit or the deliberate barring of the way to new rivals, intervention is justified in the public interest. II. T H E BASIS OF COMPETITION POLICY
So, let us get to the basics of competition policy and its justification. Competition policy comprises the Government's intervention in the free play of market forces, an intervention that is justified because left to themselves market forces can destroy competition and strangle enterprise. I do not think many nowadays would disagree that in a modern, developed market economy the State must have a purposeful policy towards competition, or rather towards the many circumstances in which competition is absent or ineffective. As Sir Geoffrey Howe said, in introducing the Fair Trading Bill, the freedom that the market economy provides 'may be used to concentrate power, to limit competition and may be used in ways contrary to the public interest'.8 The recognition over a period in excess of 30 years in the UK that the Government has a responsibility to promote competition both as a spur to efficiency and as an integral part of industrial policy generally provides a common refrain through all the various developments and changes in policy to which I have referred. The other common refrain is that the promotion of competition is not an end in itself, and that any restrictions on competition that may exist must always be judged against a broad criterion of the 'public interest'. This is a difficult and controversial concept, as I shall illustrate, but its pre-eminence ensures that, in the UK, competition policy
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can never become an inflexible dogma. As I have already indicated, competition policy has to recognise that the competitive process itself produces responses which may have anti-competitive consequences. It must be concerned with what is happening in markets and what may happen. Put another way, it must be concerned with monopolies and cartels, with mergers and with anti-competitive conduct. Let me take these in turn. .
It is concerned with the possible abuse of market power, by which single firms (monopolies) or groups of firms (cartels) escape the disciplines of competition, irrespective of whether such firms have built up their power by fair means or foul. Being a monopoly is one thing--taking advantage of monopoly power is another. In the words of Shakespeare: O! it is excellent To have a giant's strength, but it is tyrannous To use it like a giant. 9 One multinational company, Hoffman-La-Roche, has been the subject of scrutiny by both national competition authorities and by the EEC. In 1973, the UK Monopolies Commission, having conducted an exhaustive examination into the pricing policies of the company for the supply of the well-known tranquillisers, Librium and Valium, in which they had a 99 per cent monopoly, concluded that their UK prices had been manifestly too high for some years and that they had obtained in consequence excessive monopoly profits. 1° The Government ordered them to reduce their prices by a considerable margin and to repay large sums to the National Health Service for excessive prices already charged. In 1976 the EEC Commission found that Roche had abused its dominant position in the markets for various categories of vitamins by entering into exclusive or preferential supply agreements with major industrial buyers that provided for fidelity rebates so calculated as to induce them to obtain all or virtually all their requirements from Roche. ~1 The European Court later confirmed the Commission's view and asserted that such conduct was incompatible with undistorted competition because it restricted the purchaser's scope for choice and raised barriers to market entry by other producers. 12 . Competition policy is concerned with structural trends and changes in ownership which may create or intensify market power (i.e. mergers), a recent example being the proposed European Ferries/Sealink merger which would have created, if it had been effected, a 70 per cent monopoly on the short cross-channel routes to France. . Competition policy is concerned with the behaviour of firms, whether in oligopolitistic markets, or alone, which, whether or not technically monopolists, are nevertheless in a dominant position. Under the Competition Act 1980, I am enabled to carry out an investigation into any course of conduct if I think it may amount to an anti-competitive practice. Examples of such conduct could be exclusive dealing arrangements, tie in sales, predatory pricing and a manufacturer's selective distribution system.
My first investigation under these new powers was into Raleigh's system of supplying its bicycles selectively to certain types of retailer only. My conclusion was that the company's 45 per cent share of the bicycle market and the brand loyalty
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which Raleigh bicycles commanded were such that the company's refusal to supply certain multiple retailers could adversely affect competition as between different types of retailer and deprive the public of potentially lower prices. ~3 To my mind there was here an anti-competitive practice and later the Monopolies and Mergers Commission agreed with that view and added that it was contrary to the public interest for it to continue. 14 III. C O M P E T I T I O N POLICY WITHIN THE USA I want now to draw some comparisons between the growth and experience of competition policy in the USA and that in the UK. Of course, much of the American experience is a response to peculiarly American conditions and concerns, and that must always be borne in mind. But there is also much of interest there from which British and European authorities and business can benefit. I fully endorse Edward Gibbon's comment in his Decline and Fall o f the Roman Empire In all the pursuits of active and speculative life, the emulation of states and individuals is the most powerful spring of the efforts and improvements of mankind. Competition policy arose in the USA in response to the consequences of emulation between individuals; and as competition policy spread to the UK somewhat later, it may be regarded as a good example of emulation between states. Any discussion of competition policy must make some sort of a bow in the direction of the USA because of that country's long experience--nearly a hundred years. The origin of US anti-trust policy lay in the vigorous--almost explosive--economic growth in the second half of the 19th century. This growth took place in a market almost untouched by government regulation, and one consequence was the rapid development of monopoly situations and accompanying anti-competitive practices which threatened to strangle the very market freedom upon which growth had been based. A widespread feeling that the power conferred by monopoly was unacceptable not just in economic, but also in political terms, was a powerful incentive towards the passage of the early anti-trust legislation. The need to restrain untrammelled economic power was seen as a constitutional requirement as much as an economic one.
The American approach relied on legal and judicial process and, until the present, at least, on the predominance of law over economics. Historical and cultural traditions thus led to a greater dependence on per se prohibitions and a rigorous attitude towards horizontal mergers, i.e. mergers between companies supplying the same goods or services. Why does anti-trust, as competition policy is usually termed in the USA, seem to have found such ready acceptance ever since the Sherman Act 1890? One can identify a number of factors. One has been the general confidence of Americans in the vigour and success of their economy. Another has been the more philosophical feeling, well expressed in the Massachusetts Bill of Rights, that there should be 'a government of laws and not of men'. There is also in the USA a lower level of confidence in consensus politics and a strong vein of distrust of 'big business'. Although the emphasis may change (as indeed it has done under the present Administration) there is no sign of any questioning of the need for an anti-trust policy. As a result, industry and commerce in the USA build into their planning:
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anti-trust considerations--they and their teams of in-house lawyers take full account of the existing judicial precedents and the likely attitude of the Department of Justice and the Federal Trade Commission to their activities. IV. COMPETITION POLICY IN THE U N I T E D KINGDOM Competition has not always been held to be especially virtuous in the United Kingdom. Let me quote, for example, from the MacMillan Committee on Finance and Industry in 1931: It has been represented to us strongly in evidence that a great deal remains to be done in more than one important industry in overcoming sectional and individual opposition to desirable amalgamations and reconstructions designed to eliminate waste and cheapen costs. It was stated to us that very important economies and much greater efficiency are possible if there are concerted movements to that end. We believe this to be the case . . . . 15 There was a change in attitude during the war, partly as a result of the impact of Keynes, partly through public disquiet about restrictive trading agreements, partly through a sense that the trading patterns of imperial preference were over and that we were thrown back more and more upon our own resources. The consequence was the 1948 Monopolies and Restrictive Practices Act--the first piece of UK anti-trust legislation. In many ways, this was characteristically British, reflecting our different cultural traditions and, in particular, the strong disposition in the UK to avoid conflict and legalism. There were no p e r se prohibitidns. Instead, nothing could be prohibited unless the newly created Monopolies Commission condemned the agreement or practice and the Government chose to follow its recommendations. That first piece of UK legislation had, as Professor Rowley has said, 'its fair share of faults' but that few problems have arisen in respect of its scope is itself, he added, 'a tribute to those responsible for it'.~6 UK legislation had built into it from the start the concept that the ultimate objective was the public interest, and that by implication competition policy should be regarded as a means to this wider end. Although the precise wording of the legislation varies, all UK competition law, whether it deals with monopolies, mergers, restrictive trading agreements or anti-competitive behaviour, requires a case-by-case approach to decide whether or not a particular situation or course of conduct is contrary to the public interest. UK competition policy must always be seen in this context. The early reports of the Monopolies Commission (set up by the 1948 Act) were concerned primarily with cartels; and the experience of the Commission in the early 1950s, after examining various cartel arrangements, convinced it that they must almost always be against the public interest. This led to the Restrictive Trade Practices Act 1956 which created the Office of the Registrar of Restrictive Trading Agreements and the Restrictive Practices Court to deal with agreements between companies relating to the supply or production of goods in the UK. Thus was established the twin pillars of UK competition policy: the judicial system and the administrative or discretionary system. The judicial system has operated in the case of restrictive trading agreements or cartel agreements in the field of goods since 1956. Here, the presumption is that all such agreements are contrary to the public interest but the Court may allow them, provided that exceptionally they can be justified in the terms of the so-called 'gateways.' in the Act and that there is a balance
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of advantage over detriment. Similar procedures and provisions were established in 1964 for resale price maintenance 17 (the nearest thing to a per se prohibition in UK competition policy) and the provisions of the Restrictive Trade Practices Act were extended to services in 1976. V. DISCRETION AND THE ADMINISTRATIVE SYSTEM The administrative system continues for all other aspects of competition policy. Monopolies and, since 1965, mergers are not subject to any rule that they are per se or even p r i m a facie a bad thing. Rather they are subject to a discretionary power in the Government to initiate an enquiry by the Monopolies and Mergers Commission to determine the public interest, and a further discretionary power in the Government to act upon the Monopolies and Mergers Commission's recommendations. The administrative system has been further developed by the Competition Act 1980. My own post was created in 1973 and my Office now has the main initiating role both within the judicial system by taking cartel agreements to the Court for judgment and within the discretionary system by taking monopoly and anticompetitive practice problems to the Monopolies and Mergers Commission and advising Ministers on whether particular mergers should go to the Monopolies and Mergers Commission. Professor O'Brien of the University of Durham wrote a paper last year on 'Competition Policy in Britain' in which he said that since 1973 'a silent revolution' in the operation of competition policy had occurred so that the predominantly legalistic approach (through the Restrictive Practices Court) had been 'supplanted' by the development of an administrative and discretionary procedure. 18 He added that British policy seems to have evolved silently to the point where, on the basis of the legal foundations, the future thrust of policy will be along administrative and discretionary lines. I do not know whether by expressly agreeing with Professor O'Brien the revolution becomes less of a silent one; but I think he is right in both his analysis and his prognosis though I would add that the Restrictive Practices Court is going to have to give judgments in the near future on a number of important restrictive trading agreements relating to services, including the exclusive dealing agreement of ABTA, and the fixed commission restrictions of the Stock Exchange. So the Court still has a useful active life ahead. But perhaps Professor O'Brien is more percipient than he realised, because even within the judicial system, a limited but nonetheless important discretionary element exists. Although I have a general duty to take before the Court all restrictive trading agreements that have been registered, I have a discretion (with the Secretary of State for Trade's agreement) to refrain from going to Court if the restrictions are not of such significance as to call for investigation by the Court. I have made it known that all agreements are considered with the possibility of this discretion being exercised and in many cases, no doubt with the severity of the Court's judgment in earlier cases in mind, parties to agreements are prepared to modify them and to dismantle restrictions embodied in them in order that no 'significant' restrictions remain. So it is, therefore, that trade association agreements, recommending to their members standard terms of contract on which they should do business, may not have to go to the Court if they appear to the Office to be fair to both sides, to be not
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misleading and to allow for suitable variation in exceptional circumstances. A number of joint ventures thus have been given the green light where the restrictions are no more than necessary for the joint venture. On close examination, restrictive agreements may in fact turn out to be pro-competitive rather than anti-competitive, e.g. arrangements (like franchise agreements and buying groups of retailers) that allow new businesses or small businesses to compete more effectively against established businesses than would be possible alone, and where the restrictions on competing with one another are essential to that pro-competitive effect of the agreement. Where there is a large element of discretion in policy, there must also be a large degree of unpredictability and that is a charge often levied by business against the operation of competition policy in Britain, particularly perhaps in its application to mergers. But I have just shown that even in the field of restrictive trading agreements, where even 25 years ago there was a general consensus that only exceptionally could they be justified as being in the public interest, we have moved towards a greater discretion because there is so often a need to balance the anti-competitive features with features that are pro-competitive or otherwise in the public interest. There is no consensus that all or most mergers are undesirable and, although there may be argument as to whether present policy is too benign towards them, we must surely continue to have a system that does its best to weigh up the pros and cons. US law, on the face of it, is much more predictable than ours, and much more inflexible. The Sherman Act states that all combinations in restraint of trade are hereby declared illegal and anyone attempting to monopolise any part of trade or commerce shall be guilty of a misdemeanour. But the Americans too, modifying the p e r se prohibition of the Act by a so-called rule of reason, have moved towards a greater flexibility. The net result is that similar trading practices are often treated similarly by the authorities in our two countries and this is so despite the fact that the USA depends a great deal more on the judicial process than we do. Thus in the Sylvania case, ~9in 1977, the US Supreme Court ruled that a very rigid exclusive distribution network operated by a manufacturer of TV sets, whereby dealers were forbidden to sell outside their own territories, was not anti-competitive because the company concerned had only a small market share--some five per cent - - a n d any restriction on intra-brand competition was outweighed by the increase in competition between the company's brand and its competitors' which arose because the restrictions gave Sylvania's retailers powerful incentives for investment and promotion of the product. Here in the UK, by contrast, I concluded in the Raleigh case2°--and the Monopolies and Mergers Commission agreed--that in view of Raleigh's dominant position in the market the company's selective distribution system amounted to a significant restriction on intra-brand competition without doing anything to increase competition with brands other than Raleigh's. I see no inconsistency between those two cases--they both show that it is a matter of balancing the pro-competitive features of the business practice against the anticompetitive features. My other example is drawn from the treatment of attempts to maintain a local "monopoly. In the Lorain Journal case 21 in 1951, a local newspaper in Ohio sought to put a local radio station out of business (and thereby retain its monopoly of local advertising) by refusing to accept advertisements from anybody who advertised on local radio. This conduct was condemned by the Supreme Court as a clear attempt to maintain its local advertising monopoly. In the UK, very similar behaviour by Sheffield Newspapers Ltd (though this time in relation to competition from a free
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newspaper rather than a radio station) was found by me to be anti-competitive in a recent report under the Competition Act. 22 The company concerned gave undertakings regarding part of their course of conduct, and the rest is now being investigated by the Monopolies and Mergers Commission. VI. THE FUTURE The present may not seem a good time for competition policy. As is inevitable during a recession, powerful voices are raised demanding protection; and there is pressure to try to safeguard jobs in the short term at the expense of long term efficiency. Nevertheless, in times of recession competition policy becomes, in my view, more rather than less important, since it is a vital instrument in the promotion of efficiency and in facilitating the process of adjustment to changed economic circumstances, without which recovery from the recession can only be further delayed. (The experience of the last 50 years demonstrates all too clearly that to try to isolate UK industry from world trends leads to greater hardship in the end--as witness the experience of our shipbuilding, steel and motor vehicle industries.) It is also easier to allow anti-competitive practices to develop than to get rid of them when they are established, even when more buoyant economic conditions arrive, and the case for a Government competition policy in the interests of increasing freedom and encouraging entrepreneurship remains as strong as ever. Without it, in the end, the consumer pays. Nevertheless, our policy must, of course, remain flexible. In times of recession, in particular, the conflict between fairness and efficiency is likely to be particularly acute, and too much emphasis on efficiency may in the long run be self-defeating if the gains (e.g. from economies of scale) lead to the establishment of oligopolies and an eventual reduction in the level of competition. We need also to take account of factors little regarded 10 years ago, such as our relationship with Europe and the increasing internationalisation of manufacturing industry. I endorse the view that we need to place more emphasis on the service sector (including the professions which have contributed to the institutional inertia that has made it more difficult to secure essential changes in tile UK). We shall need to continue to develop the use of the mix of different procedures--judicial and administrative--that has been built up over the years. One of the encouraging signs is that, just as in the USA for a very long time now business has taken account of competition policy in making its plans and trading arrangements, British business too is much more aware of how competition policy may impact upon them. My Office has always been ready to discuss merger proposals informally and confidentially with businessmen and their merchant bankers. Indeed, my policy is to run an 'open' office so that industrialists and traders can discuss with us any matter where competition policy may be relevant to their problems. British firms may not employ so many in-house lawyers as would equivalent US companies; but their numbers have risen and private firms of solicitors too are increasingly advising businessmen of the implications of competition legislation. Clearly, a growing understanding among businessmen and their advisers means that competition policy has a greater effect on decision-making in business than is seen by merely looking at the public manifestations of competition policy shown by the references to the Monopolies and Mergers Commission and to the Restrictive Practices Court. Of course, it is important to keep in perspective what active competition policy
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can achieve, and remember that it is only a means to an end, and that at the end of the day the public interest must be over-ridingwI would instance as a recent example the Monopolies and Mergers Commission's conclusion on the bids for the Royal Bank of Scotland, where though there were good arguments for both bids, in terms of promoting competition in the banking world, the Monopolies and Mergers Commission was of the opinion that on wider public interest grounds the Bank should retain its independence. 23 The fact that the Monopolies and Mergers Commission report contains two notes of dissent, and has been subject to considerable controversy demonstrates that the concept of 'public interest' is one that is open to a variety of interpretations. But although there may b e argument over who or what kind o f body should make such judgments, surely no one denies that some such notion of public interest must remain. And it is, I believe, important to maintain a climate within which commerce and industry regard the competitive process as normal, accept competition policy as a means of ensuring that it is maintained and are indeed prepared to take advantage of a more competitive environment. No one suggests that the way ahead for Britain in economic terms is other than difficult. I believe that the will to compete, within a framework whereby Government tries to ensure that such will to compete is not thwarted, is an important ingredient in the economic progress that we all want to see.
REFERENCES AND NOTES 1. Monopolies and Restrictive Practices (Inquiry and Control) Act 1948. 2. Restrictive Trade Practices Act 1956. This Act created the Office of the Registrar of Restrictive Trading Arrangements. The Registrar's function of taking restrictive trading agreements to the Restrictive Practices Court to judge whether they were against the public interest was absorbed into the office of the Director General of Fair Trading when that office was established by the Fair Trading Act 1973. 3. Monopolies and Mergers Act 1965. 4. Fair Trading Act 1973. 5. Restrictive Trade Practices Act 1976. 6. A Review of Monopolies and Mergers Policy. A Consultative Document (Cmnd. 7198), para. 3.1. 7. Speech to Bow Group made in House of Commons on 2 April 1981, reproduced in British Business of 17 April 1981 (page 747, col. 1, para. 1). 8. House of Commons Parliamentary Debates (Hansard), Vol. 848, col. 453 (13 December 1972). 9. Measure for Measure, Act II, Scene 2. 10. Monopolies Commission, A Report on the Supply of Chlordiazepoxide and Diazepam (H.C. 197 of 1972-73). 11. O J L 223 of 16 August 1976. 12. Hoffman-La-Roche & Cie SA, Basle v. Commission 85/76: [1979] ECR 461. 13. TI Raleigh Industries Ltd., A Report by the Director General of Fair Trading, 27 February 1981. 14. Monopolies and Mergers Commission, A Report on Bicycles, 16 December 1981 (H.C. 67 of 1981-82). i 5. Report of the Committee on Finance and Industry (Cmd. 3897) para. 385. 16. Charles K. Rowley, TheBritish Monopolies Commission (1966), p. 80. London: Allen & Unwin. 17. Resale Prices Act 1964. 18. D, P. O'Brien, 'Competition Policy in Britain: The Silent Revolution', (1982) 27 Antitrust Bulletin, pp. 218 and 238.
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Continental T. V. Inc. v. G.T.E. Sylvania Inc. 433 US 36 (1977). See Footnote 13. United States v. Lorain Journal Co. 342 US 143 (1951). Sheffield Newspapers Ltd., A Report by the Director General of Fair Trading, 27 October 1981. 23. Monopolies and Mergers Commission, A Report on Proposed Mergers with the Royal Bank o f Scotland Group Ltd., HMSO, January 1982.