Delhi High Court Denies Indian Regulator
The Competition Commission of India (CCI) was put in its place by the Delhi High Court earlier, when the latter ruled that the authority of the CCI is restricted to regulating markets and does not encompass the examination of decisions made by statutory regulators, such as the Institute of Chartered Accountants of India (ICAI).
The ICAI are conducting the Continuing Professional Education, a program where the CCI had reason to assume anticompetitive conduct and directed the Director General to investigate the matter. This order by the CCI was set aside by the Delhi High Court with sound reasoning from Justice Justice Vibhu Bakhru, who stated:
“The CCI has wide powers under the Competition Act but this Court is unable to accept that the said powers extend to reviewing all decisions made by statutory bodies or a foreign government, which are not relatable to a sovereign function of the Government. The scope of examination must be confined to only those areas of economic activities, which have a bearing on the market that engages entities involved in trade and commerce.”
The CCI may have been more successful in communicating the matter to the Central Vigilance Commission (CVC), the regulatory body responsible for overseeing the functioning of government institutions and ensuring that they act within the bounds of the law. The CVC is an apex government body that acts as a statutory regulator, whose aim it is to prevent corruption and misconduct in the public administration.
Broadcom/VMware Debacle Continues
The $61 billion supermerger between the software company and the chipmaker has been closely scrutinised by – so far – three regulators (EU, UK, US) and has drawn more media attention than any other merger discussion in the past year. At the beginning of May, Broadcom CEO Hock Tan provided testimony during a closed hearing alongside senior European Commission officials where it was argued that the presence of Amazon, Microsoft, and Google in the cloud sector was evidence of robust competition.
Regulators however are more concerned with the lack of competition in the hardware component sector, specifically addressing restrictive competition in the global market for the supply of fibre channel host bus adapters and storage adapters. The EU commented that if left unchallenged, the deal could result in “higher prices, less innovation and lower quality products that will impact businesses and consumers.”
Broadcom is optimistic that the deal will go through this fiscal year, despite having to possibly divest up to two units after acquisition, according to information provided by Business Insider.
Apart from this, Broadcom doesn’t have much to complain about at the moment, specifically taking into account that they recently closed a multi-billion-dollar (with a “b”) deal with Apple over 5G radio frequency components that raised their stock by 2.2% – a record high.
Bolt Looking To Take Tier For A Ride (One Way)
European micromobility startup Tier is currently in late-stage acquisition discussions with its rival, Bolt. As the micromobility sector faces challenges in obtaining growth capital and managing expensive operations, mergers – or at least the discussion of mergers – become a prevailing trend. Bolt, headquartered in Tallinn, Estonia, is currently conducting due diligence on Tier, with the valuation of the potential deal yet to be determined. The acquisition could be finalised within a few weeks.
Berlin-based Tier is a dominating entity in the mobility business, operating e-scooters and e-bikes in 560 cities worldwide. Tier products such as e-bikes and scooters are by far the most represented when you are looking for mobility options in any larger German city. However, the company has faced significant challenges in the past year. The company has accrued over €130 million in debt and has struggled with substantial losses, which have led the company to conduct multiple layoff rounds in the past year.
Moreover, Tier has encountered an increasingly challenging political climate, particularly in one of its key markets, Paris. The city recently voted to ban rental e-scooters, posing further obstacles for Tier. Currently holding a licence to operate 5,000 e-scooters in Paris, the company will need to remove them by the end of August. Additionally, Tier faced setbacks earlier this year when it lost a tender in Oslo and was excluded from the tender in Vienna last month.
However, as mentioned above, Tier is not the only mobility company going through these struggles. The same goes for rivals such as Voi or Bird. It is quite safe to assume that we will see further mergers in this area in the year to come.
Australian Watchdog Challenges Qantas and Virgin Australia
To address the issue of limited competitive pressure on Qantas and Virgin Australia, resulting in higher ticket prices, the Australian Competition and Consumer Commission (ACCC) has proposed a solution: the opening up of peak-time landing slots at Sydney Airport. The ACCC, an independent regulatory body, recognizes that the lack of competition in the aviation industry has contributed to an increase in the price of tickets which is of course a direct detriment to the consumers.
By recommending the opening up of peak-time landing slots, the ACCC aims to introduce more competition into the market. This means allowing other airlines, both domestic and international, to access these slots, enabling them to compete with Qantas and Virgin Australia on equal footing. This increased competition is expected to result in benefits for consumers, such as lower ticket prices, improved service quality, and increased options for travel.
The ACCC’s proposal recognizes the importance of a healthy competitive environment in fostering innovation and efficiency within the aviation industry. Opening up peak-time landing slots not only promotes competition between airlines but also encourages new entrants to the market. This could potentially lead to more choices for travellers, as well as spur investment and the introduction of new services.
