17th Jun 2015 14:59
LONDON (Alliance News) - Competition regulators Wednesday said they will not refer the award of the InterCity East Coast franchise to a venture owned by Stagecoach Group PLC and Virgin Group Holdings Ltd for an in-depth investigation.
In a statement, the Competition and Markets Authority said it has accepted undertakings put forward by Stagecoach to allay concerns about the effect of the award on competition.
The undertakings mean Stagecoach must to commit to a price cap on some of the fares set by its East Midlands Trains and on the InterCity East Coast franchise, with the CMA to monitor the fares on an ongoing basis. The price caps were agreed after the CMA found there were competition concerns about rail journeys from Peterborough to Grantham and Lincoln.
The CMA also found competition concerns about the Edinburgh to Dundee and Edinburgh to Aberdeen coach service routes in relation to Stagecoach's stake in Scottish coach service provider Citylink. Stagecoach's undertakings require that "decisions which may impact the competitiveness of these coach services" must be taken by Stagecoach's joint venture partner ComfortDelGro instead of Stagecoach, with the decisions relating to fares, timetables, frequency and service quality.
Decisions regarding fares relating to seats sold through Stagecoach's megabus.com website will be "subject to scrutiny" by ComfortDelGro.
Stagecoach shares were up 1.5% at 403.60 pence on Wednesday afternoon.
By Samuel Agini; [email protected]; @samuelagini
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