Compelling economics only lives up to its name if it delivers compelling outcomes. (Empty rhetoric never solved a client issue.) Have we managed to do this? Consult any of the following:
In the last five years, the European Commission has made substantial efforts to promote the private enforcement of competition law and to ensure that decision-making across Member States is informed and consistent. An important part of this policy initiative is the training of national judges in EU competition law, including the use of economics.
Bus and train transport service operator, Arriva, had been operating a bus service between Luton Airport and London Victoria for the past 30 years. In May 2013 Luton Airport stopped giving Arriva access to the airport bus station, and instead granted National Express, which also provides bus and train services, an exclusive concession in exchange for a significant proportion of National Express' passenger revenue. This agreement was due to run for seven years and also granted National Express the right of first refusal over the operation of other services on routes between the airport and other destinations in London.
In February 2013, the Australian government decided to wait two years before making a decision on any cash equity central counterparty (CCP) licence applications. With LCH.Clearnet Ltd waiting in the wings, ASX, the current sole provider of clearing services for cash equities traded in Australia, committed to a code of (good) practice including a promise to commission an independent global benchmarking study of its clearing and settlement services.
Following an appeal by the Major Electricity Users Group (MEUG), the High Court in New Zealand rejected the Commission’s approach to determining the assumed return for electricity distribution and transmission businesses on investments in their networks. The Court did not impose the alternative proposed by the MEUG, but did require the Commission to demonstrate evidence if it wanted to maintain its existing approach; namely, to include a margin within the assumed profit for the energy network businesses (i.e. the cost of capital) to offset the risk of underinvestment.
Following the 'Action for Roads' paper published by the Department for Transport in July 2013, the government proposed to put in place legislation to move the Agency from a civil service department to an independent company, with commercial incentives and flexibility to develop and manage £15 billion of investment in the roads network as efficiently as possible. The Agency needed to develop a plan that would meet the government's requirements on network performance and efficiency, while also committing to a list of schemes and a series of network renewal targets, all at a time when the rules for what a good plan should look like had not been written down.
In October 2014 Liberty Global completed a €9bn merger between its Dutch subsidiary, UPC NL, and Ziggo. The arrangement involved both horizontal and vertical issues as the parties integrated their networks and media platforms. The transaction was subject to a Phase II merger review by the European Commission.
RWE faced an in-depth European Commission state aid investigation concerning aid to convert its Lynemouth plant from coal to biomass. The Commission raised concerns that the aid might be illegal under EU state aid rules, due to the potential for the aid to lead to the plant being excessively profitable; and that the fuel requirements of the biomass plant might distort competition in global markets.
First Gas, a gas distribution network in New Zealand, asked Oxera to give evidence on regulatory finance issues to the New Zealand Commerce Commission (NZCC). In particular, we were asked to provide expert evidence in relation to the Commission's assessment of systematic risk for gas pipeline businesses in New Zealand, relative to electricity networks. As part of this assignment, Oxera also advised the parent company, First State Investments.
