Macfarlanes prevails in appeal against OFT

Macfarlanes’ competition team won a historic victory against the Office of Fair Trading (OFT) last week when it got an OFT merger ruling overturned for the first time ever.

The Competition Appeals Tribunal (CAT) ruled in favour of Macfarlanes’ client IBA Health and overturned a ruling made by the OFT that IBA’s competitors iSOFT Group and Torex could merge.

Australian healthcare company IBA, which has instructed Macfarlanes on corporate matters for some time, asked the CAT to use a new expedited procedure to review the merger decision. This has only been possible since the Enterprise Act came into force earlier this year.

Macfarlanes head of competition Jane Whittaker said: “As this was a judicial review, it wasn’t a review on the merits of the case, but an assessment of whether the OFT’s decision was reasonable. That’s quite a high threshold.”

Whittaker said the case will define how the OFT and the Competition Commission will interact. She explained: “In cases where there’s a likelihood of a substantial lessening of competition, the OFT shouldn’t make the final decision [in a merger case] on its own, except in very exceptional circumstances. It should refer the case to the Competition Commission.”

But Macfarlanes assistant Marc Israel said: “If an appeal isn’t merited, it will meet with short shrift from the Competition Commission, so it won’t open the floodgates.”