{"id":64255,"date":"2015-11-17T10:00:07","date_gmt":"2015-11-17T10:00:07","guid":{"rendered":"http:\/\/mostafa.openonline.co.uk\/?guid=c5959035cfb059e3741cbbcd5f155ce0"},"modified":"2015-11-17T10:00:07","modified_gmt":"2015-11-17T10:00:07","slug":"press-release-car-auction-merger-prompts-competition-concerns-in-north-east","status":"publish","type":"post","link":"https:\/\/mostafa.openonline.co.uk\/?p=64255","title":{"rendered":"Press release: Car auction merger prompts competition concerns in north-east"},"content":{"rendered":"
\n

BCA<\/abbr> Marketplace plc (BCA<\/abbr>) and SMA<\/abbr> Vehicle Remarketing Ltd (SMA<\/abbr>) both provide used vehicle auction services in the UK. Over 7 million used cars change hands each year in the UK, with 1.4 million of these sold through an auction at some stage. BCA<\/abbr> operates 17 auction sites and SMA<\/abbr> operates 5.<\/p>\n

The Competition and Markets Authority (CMA<\/abbr>) found that BCA<\/abbr> faces strong competition from another national car auctioneer and a range of other local used car auctioneers in most UK regions. Customers and competitors raised concerns with the CMA<\/abbr> during the investigation that the merger might lead to increased prices or reduction in services in the north-east of England and Scotland. <\/p>\n

In Scotland the CMA<\/abbr> found that, following the merger, the merged parties will face competition from 4 other competitors and that as a result, no concerns arose in this area. <\/p>\n

In the Newcastle area, the CMA<\/abbr> found that BCA<\/abbr> and SMA<\/abbr> were close competitors, and that following the merger the merged entity will face competition from only one other physical auction site. <\/p>\n

The CMA<\/abbr> has therefore found that the merger may lead to higher prices or a reduction in choice or quality of service for customers of used vehicle auction services at physical auction sites in the Newcastle area. <\/p>\n

The CMA<\/abbr> did not consider the merger raised national competition concerns. <\/p>\n

This merger will be referred for a phase 2 investigation unless BCA<\/abbr> offers acceptable undertakings to address the competition concerns in the north-east in a clear-cut manner. <\/p>\n

Sheldon Mills, Senior Director of Mergers and decision-maker in this case, said:<\/p>\n

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Used vehicle auction services are vital for businesses involved in the buying and selling of used vehicles. We found a significant competitive overlap between the merging parties in the north-east of England which could drive higher auction prices or reduced services or quality.<\/p>\n

BCA<\/abbr> has the opportunity to avoid a full phase 2 investigation by offering a solution that clearly addresses these concerns and safeguards the interests of customers.<\/p>\n<\/blockquote>\n

Notes for editors<\/h3>\n
    \n
  1. The CMA<\/abbr> is the UK\u2019s 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. <\/li>\n
  2. Under the Enterprise Act 2002 (the Act<\/abbr>) the CMA<\/abbr> has a duty to make a merger reference, resulting in a full phase 2 merger investigation, if the CMA<\/abbr> believes that it is or may be the case that a \u2018relevant merger situation\u2019 has been created, or arrangements are in progress or in contemplation which, if carried into effect, will result in the creation of a relevant merger situation; and that the creation of that situation has resulted, or may be expected to result, in a substantial lessening of competition within any market or markets in the United Kingdom for goods or services.<\/li>\n
  3. Under the Act<\/abbr> a \u2018relevant merger situation\u2019 is created if 2 or more enterprises have ceased to be distinct enterprises; and the value of the turnover in the United Kingdom of the enterprise being taken over exceeds \u00a370 million (\u2018the turnover test\u2019) or as a result of the transaction, in relation to the supply of goods or services of any description, a 25% share of supply in the UK (or a substantial part of the UK) is created or enhanced (\u2018the share of supply test\u2019). <\/li>\n
  4. The CMA<\/abbr> considers that it is under a duty to make a phase 2 merger reference in this case under section 22(1) of the Act<\/abbr>. However, the duty to refer is not exercised pursuant to section 22(3)(b) while the CMA<\/abbr> is considering whether to accept undertakings under section 73 of the Act<\/abbr> in lieu of a reference. Pursuant to section 73A(1) of the Act<\/abbr>, BCA<\/abbr> has until 24 November 2015 to offer an undertaking to the CMA<\/abbr> that might be accepted by the CMA<\/abbr> under section 73(2) of the Act<\/abbr>. If no undertaking is offered or accepted, then the CMA<\/abbr> will refer this merger pursuant to sections 22(1) and 34ZA(2) of the Act<\/abbr>. <\/li>\n
  5. All the CMA<\/abbr>\u2019s functions in phase 2 merger investigations are performed by inquiry groups chosen from the CMA<\/abbr>\u2019s panel members. The appointed inquiry group are the decision-makers on merger investigations. <\/li>\n
  6. The CMA<\/abbr>\u2019s panel members come from a variety of backgrounds, including economics, law, accountancy and\/or business; the membership of an inquiry group usually reflects a mix of expertise and experience (including industry experience). <\/li>\n
  7. The inquiry group may extend the 24-week period within which it is required to publish its report by no more than 8 weeks if it considers that there are special reasons why the report cannot be published within that period.<\/li>\n
  8. The text of this decision will be placed on the case page<\/a> as soon as is reasonably practicable.<\/li>\n
  9. For information on the CMA<\/abbr> see our homepage<\/a>, or follow us on Twitter @CMAgovuk<\/a>, Flickr<\/a> and LinkedIn<\/a>. Sign up to our email alerts<\/a> to receive updates on merger cases.<\/li>\n
  10. Enquiries should be directed to Simon Belgard (simon.belgard@cma.gsi.gov.uk<\/a>, 020 3738 6472).<\/li>\n<\/ol>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

    BCA\u2019s acquisition of SMA faces an in-depth merger inquiry unless it offers a solution to competition concerns in car auctions in Newcastle.<\/p>\n","protected":false},"author":8,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[13],"tags":[],"_links":{"self":[{"href":"https:\/\/mostafa.openonline.co.uk\/index.php?rest_route=\/wp\/v2\/posts\/64255"}],"collection":[{"href":"https:\/\/mostafa.openonline.co.uk\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/mostafa.openonline.co.uk\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/mostafa.openonline.co.uk\/index.php?rest_route=\/wp\/v2\/users\/8"}],"replies":[{"embeddable":true,"href":"https:\/\/mostafa.openonline.co.uk\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=64255"}],"version-history":[{"count":0,"href":"https:\/\/mostafa.openonline.co.uk\/index.php?rest_route=\/wp\/v2\/posts\/64255\/revisions"}],"wp:attachment":[{"href":"https:\/\/mostafa.openonline.co.uk\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=64255"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/mostafa.openonline.co.uk\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=64255"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/mostafa.openonline.co.uk\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=64255"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}