On 23 May, Mr Justice Moses handed down his judgment in the Interbrew/Bass case. In an unprecedented ruling, the January decision of the Secretary of State for Trade and Industry requiring the divestment of Bass by Interbrew was overturned.`Interbrew's challenge to the Competition Commission and Government's decisions was based on the argument that the remedy was disproportionate and the procedure unfair. Interbrew did not seek to challenge the adverse public interest effects – duopoly over brewing and route to market, higher beer prices and reduced consumer choice – which formed the basis of the Government's decision. Judge Moses disagreed that the remedy was disproportionate. He also disagreed that inviting Interbrew to comment on issues and remedies before declaring that the merger was contrary to the public interest was unfair. In fact, he found for the Government and the Competition Commission on most points.`But the judge did find for Interbrew on one point, and this was sufficient to overturn the Government's decision and the part of the Competition Commission's report dealing with the recommended divestment orders. He did not accept that Interbrew ought to have appreciated and therefore had the opportunity to comment on the concern that the dual capacity of Interbrew as licenser of Stella and owner of Bass made the divestment of Whitbread (with the Stella Artois licence) an unworkable alternative remedy. The concern identified in the report was that Interbrew, as owner of Bass, would either shy away from competing with Whitbread in premium lager or use its position as licenser of Stella to persuade Whitbread not to compete with the Bass brands (for example Grolsch). Either way, competition would be undermined between Bass and Whitbread and the remedy would fail to address adequately the adverse effects identified. Apparently, this point was not put to Interbrew.`The case now goes back to the Secretary of State to find a remedy, with the Director General of Fair Trading's help and following all due consultation, to address the adverse public interest effects which remain outstanding. Whether the Government will, after correcting the procedural defect, reach the same decision as before remains to be seen. What is clear is that the judgment will lead the Competition Commission to review its procedures.`One possibility would be to establish clear water between the finding of adverse effects and the examination of viable remedies. The process used in Brussels under the EC Merger Regulation enables the parties to see the objections against them before they negotiate over remedies, albeit under tight time-scales. Under the UK system, the parties have the opportunity to put their case to the Competition Commission and offer remedies to the Government, but in these discussions they do not have full sight of their opponents' hands. While the judge did not disapprove of the intellectual poker required of defendants under the UK system, a more transparent system by which the case against the parties is revealed at an earlier stage may have avoided the procedural failure that he identified.`Another likely outcome of the case will be a greater tendency towards caution and accountability on the part of government and the competition authorities in deciding merger cases. The prospect of judicial review has up until now been a distant one.`The depoliticisation of merger decisions, and the need to ensure that the parties should know the case against them, were prominent in the Government's consultation paper of October 2000 on the reform of the UK merger regime. The Government stressed in its Manifesto for Business, presented to the City on 29 May, the need to strengthen the independence and proactiveness of the competition authorities. While the Interbrew/Bass case was decided on competition rather than political grounds, it will no doubt help to bring focus to the debate on reform of the UK merger regime.`Simon Taylor is an associate in the European antitrust group at Allen & Overy