Lawyers welcome joint approach as proposals are floated to unite competition agencies

The Competition Commission and the Office of Fair Trading (OFT) have published joint merger assessment guidelines for the first time, in a move which has intensified speculation that the two bodies could merge to form a single oversight body.

The joint guidelines, which were published last week (16 September), have been created to provide greater clarity to companies and their advisers on how both bodies will assess the competitive impact of a merger.

The guidelines revise and expand guidance previously issued separately by the two watchdogs, with partners at City firms praising the move as a "productive step forward".

"The fact that this is joint guidance from two institutions is positive and constructive," said Linklaters competition partner Alec Burnside.

"The trend towards offering substantive guidance of this kind has gathered pace in recent years. The substantive aspect of merger control has become more sophisticated and the quality of assessment has also increased."

The new guidelines set out in detail the latest economic thinking on how to assess mergers.

Freshfields Bruckhaus Deringer competition partner John Davies (pictured) said: "We welcome the fact that the OFT and the Commission worked closely with the EU and the US, which should help the authorities to achieve greater international convergence and consistency in substantive merger assessment."

Baker & McKenzie corporate partner Robert Adam commented: "Although the new guidelines are not a watershed, they should provide more flexibility for companies and their advisers. The guidelines should provide more scope for both parties to use different arguments in order to get a positive result."

Despite the positive response from partners to the new guidelines, many acknowledged that there are significant tensions between the two bodies.

Nabarro EU and competition partner Brian Sher commented: "There is an inherent tension in these joint guidelines, because the two bodies have very different roles in merger control. In recent years there has been a trend in OFT practice away from detailed market definition and towards an emphasis on assessing whether there is a competition problem. The Commission has more time, and so the balance is a little different there."

Separately, the Government has confirmed that it is considering merging the OFT and the Commission. Competition advisers to the two bodies have suggested that once Commission chairman Peter Freeman stands down from his post, the Department for Business, Innovation and Skills could push through a merger.

One partner commented: "Having two agencies is very expensive and the Competition Commission's investigations are very intensive and thus costly. Frankly, the Commission is a luxury we can no longer afford."