OFT still rules on mergers

THE Office of Fair Trading retained its position as the country's main gatekeeper on merger reviews despite losing at the Court of Appeal today.

Competition experts and the OFT, headed by economist John Vickers, had been concerned that a recent ruling from a revamped Competition Appeals Tribunal would see deals being referred for in-depth reviews at the merest suspicion of competition concerns.

City lawyers and the OFT homed in on today's ruling by Britain's top commercial judges which said: 'In between the fanciful and a degree of likelihood less than 50% [chance that a deal will lead to a substantially lessening of competition] there is a wide margin in which the OFT is required to exercise its judgment.'

The OFT said of today's ruling: 'It provides a good basis for the OFT's role in the UK merger review assessment from now on.'

The OFT will now have to re-examine its decision to greenlight a £700m software merger between iSoft and Torex, but today's ruling means it only has to explain its decision making more clearly.

Ben Tidswell, iSoft's competition lawyer at Ashurst, said: 'We expect the OFT to make a ruling under the new test which suits us.'