The merger regime in respect of the water
industry has been updated to harmonise better with the general
approach to mergers in the UK. Guidelines have been issued by
the Competition Commission to advise the industry. Following
the Enterprise Act 2002 it is the Competition Commission that
decides over water mergers, making these decisions non-political
by removing ministerial involvement. When the Office of Fair
Trading refers a merger to the Competition Commission, the Commission
will assess the deal by concluding, first of all, if the turnover
threshold is met, and, if this is the case, whether the deal
would prejudice the ability of the water regulator to make comparisons
between different water enterprises. If a prejudice is found
this can be counterbalanced by customer benefits arising from
the merger.

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