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A2 Micro: Updates on Competition Issues

Geoff Riley

2nd April 2011

Here are some links to recent news stories on competition and monopoly issues in the UK and the EU Single Market

1/ UK retail banking is not competitive enough - report from a House of Common Select Committee on an oligopolistic banking system: In July 2010, Metro Bank became the first new UK bank with branches on the High Street in more than 100 years but the industry remains too concentrated according to a new report.

“The financial crisis has resulted in significant consolidation of the UK retail market. Well known firms such as HBOS, Alliance & Leicester and Bradford and Bingley have either exited the market or merged with rival firms. A large number of building societies have merged, undermining the diversity of provision in the sector. Whilst these ‘rescues’ were necessary in order to preserve financial stability, the consequence has been to reduce competition and choice in the market…....The five large banks—Lloyds Banking Group, RBS, Barclays, HSBC and Santander—have an overwhelming 85pc share of the personal current account market.”

2/ BAA required to sell two more UK airports - having being forced to sell Gatwick Airport, the UK Competition Commission has confimed to airport operator BAA (owned by Spanish firm Ferrovial) that it should sell Stansted and either Glasgow or Edinburgh airports

3/ Microsoft files anti-competition suit against Google - Microsoft spent years in the European courts fighting the EU competition commission against allegations of anti-competitive behaviour featuring internet explorer. In a new twist, Microsoft claims that Google used its dominant position in the search market to restrict the growth of Microsoft services

Geoff Riley

Geoff Riley FRSA has been teaching Economics for over thirty years. He has over twenty years experience as Head of Economics at leading schools. He writes extensively and is a contributor and presenter on CPD conferences in the UK and overseas.

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