OFT investigatory powers prompt Transco to launch regional panel

Transco is setting up a regional panel to deal with the new investigatory powers of the Office of Fair Trading (OFT) under the recently introduced Competition Act 1998.

Under the act, which was brought into force on 1 March 2000, the director general of the OFT has powers to investigate suspected breaches. Under these powers, officials from the OFT can enter premises and demand relevant documents, and are able to obtain a warrant to make a search.

The UK gas transmission business, which was spun off from BG, formerly British Gas, into new company Lattice Group in 2000, is currently reviewing a number of regional firms which can be called in for legal advice at short notice should an investigation be launched.

Patrick Somers, head of legal at Transco, says: “[Officials] are supposed to give reasonable opportunity for lawyers to get into whichever office they're looking at.”

The company is split into 12 local distribution zones. It will require at least one law firm to be on call in the event of a raid by the OFT or UK energy regulatory body Ofgem, which holds concurrent powers.

Somers says that Janet Bidwell, a senior legal adviser at Transco, is responsible for making sure that the company complies with the act. But within Transco there is only Bidwell and one other lawyer who cover this area.

“If there was an investigation, there's Janet and one other lawyer, but if there's a need to respond to an investigation in the North or far South, it's difficult for Janet to reach there,” says Somers. “The investigators don't wait long before the lawyers arrive. On analysis they might wait up to half an hour or up to two hours [before beginning the investigation].”

Somers says that the panel will also address resource issues. Up until now, education and training on compliance had been carried out by Bidwell and one other lawyer, but now the new panel will also be involved.

Under the Competition Act, particular areas of interest for companies similar to Transco are access agreements, which cover what access competitors have to a network, common carriage obligations and price consideration.

The review is due to be decided in a matter of weeks. Transco's main panel of firms include Allen & Overy, Shearman & Sterling, Linklaters & Alliance and Skadden Arps Slate Meagher & Flom.