Better together?

Photo by Mohammad Sanaei on Unsplash

Better together? Not if you’re Asda and Sainsbury’s supermarket chains.

As of today (25 April 2019), the statutory regulator, the UK Competition and Markets Authority (CMA) has decided that the proposed merger between the two businesses should not take place.

As the above scenario demonstrates, the CMA has been given the power by the UK Parliament to make legally binding decisions of this nature. Theoretically, statutory regulators exist (in the main) to ensure that large business organisations do not acquire an overwhelmingly, dominant market position where they can ‘kill off’ competitors and substantially reduce consumer choice.

Stuart McIntosh, chair of the CMA inquiry group, said:

It is our responsibility to protect the millions of people who shop at Sainsbury’s and Asda every week. Following our in-depth investigation, we have found that this deal would lead to increased prices, reduced quality and choice of products, or a poorer shopping experience for all of their UK shoppers. We have concluded that there is no effective way of addressing our concerns, other than to block the merger.”

The CMA press release can be read using the link below:


https://www.gov.uk/government/news/cma-blocks-merger-between-sainsburys-and-asda

Sainsbury’s-Asda merger ‘would have harmed competition’.

A link to how the story was reported by Sky News can be found below:

Sainsbury’s/Asda mega merger is formally blocked by CMA
http://news.sky.com/story/sainsburysasda-mega-merger-is-formally-blocked-by-cma-11702941

Copyright Seán J Crossan, 25 April 2019

Published by

sjcrossan1

A legal blog by the author of Introductory Scots Law: Theory & Practice (3rd Edition: 2017; Hodder Gibson) Sean J. Crossan BA (Hons), LLB (Hons), MSc, TQFE I have been teaching law in Higher and Further Education for nearly 25 years. I also worked as an employment law consultant in a Glasgow law firm for over a decade. I am also a trade union representative and continue to make full use of my legal background. Please note that this Blog provides a general commentary about issues in Scots Law. It is not intended as a substitute for in-depth legal advice. If you have a specific legal problem, you should always consult with a qualified Scottish solicitor who will be able to provide you with the support that you require.

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