Arriva North and Northern Rail merger update

First published by Admin on August 30, 2016 in the following categories: Latest

The Competition and Market Authority (CMA) is investigating whether a merger situation has taken place between Arriva Rail North and Northern Rail Limited that would result in a substantial lessening of competition in the market(s) in the United Kingdom.

On 1st April 2016 an initial enforcement notice was served by the CMA on Arriva Rail North to ensure that no action is taking place until it has been determined whether the potential merger would cause a substantial lessoning of competition.

Due to the size of the companies, there are overlaps in the market for public transport services such as bus and rail services. When a customer is presented with more than one option for a particular service, factors such as frequency, punctuality, and cost are all factors they may consider.

By the merger taking place, it could allow Arriva to worsen what it offers to passengers and reduce the introduction of additional services. This could lead to an increase in prices or a reduction in how frequent the transport is. This could see customers switch to use the Northern Franchise or vice versa.

Derogation being permitted

Arriva has requested to make changes to its timetables and services and raise the price by up to 50p in Manchester on a day return ticket bus services whilst they are being investigated by the CMA. The CMA consented to Arriva making changes to its bus services and timetables, but did not consent to Arriva taking any other action that is prohibited under the Interim Order that has been made.

Undergoing investigation

The investigation on whether there would be a substantial lessening of competition in the market in the United Kingdom is currently taking place, and the provisional findings and possible remedies will be completed by end of August.

We will look to keep you updated with the outcome of the case – particularly given the high and constantly rising cost of travel fares squeezing consumers and businesses to the brink!