Monckton v Monckton: new silk defeats colleague in OFT’s Ryanair case

The Office of Fair Trading (OFT) has been given permission to investigate Ryanair’s minority stake in AerLingus, thanks to a Competition Appeal Tribunal (CAT) ruling.

Daniel Beard QC
Daniel Beard QC

Ryanair instructed Covington & Burling partner Georg Berrisch to challenge the OFT’s decision to investigate the airline. Berrisch instructed Monckton Chambers’ John Swift QC to lead the case.

Swift, who took silk in 1981, was defeated by Monckton’s Daniel Beard, who went on to take silk in March this year (14 March 2011).

Beard, who is standing counsel to the OFT, was instructed by OFT general counsel Francis Barr.

The budget airline challenged the OFT over its decision to investigate the takeover of rival carrier Aer Lingus – a deal that was left grounded by the European Commission in June 2007.

Later that year the Commission also turned down Aer Lingus’s request to require Ryanair to divest its minority stake on the basis that it did not have the power to restore the position that existed prior to the acquisition.

In October last year, the OFT announced it was opening an enquiry into the relationship between the companies. Ryanair challenged whether the OFT was able to investigate on the basis that it comes five years after the European Commission (EC) found that there was no material influence of one airline over the other.

The OFT, however, countered that such an investigation was timely because in July 2010, the European General Court ruled that the European Commission did not have the ability to require divestment of minority shareholdings that do not confer ’decisive influence’ for the purposes of the EC Merger Regulation.

In its ruling the CAT said the OFT was right to wait until the EC investigation was concluded to launch its investigation.

Hogan Lovells of counsel Angus Coulter commented: “The CAT found that the OFT was right to take a cautious approach to possible conflicts between EU and UK law.

“This was based both on the UK’s general duty to give “sincerer cooperation” to ensure that UK law is applied consistently with EU law and the special merger control “one stop shop” principle which says that the UK cannot look at a merger being considered by Brussels.”

Aer Lingus intervened in the matter in support of Ryanair, with Linklaters partner Eamonn Doran instructing Brick Court’s James Flynn QC for the airline.