On 12 December 2018, J Sainsbury PLC (Sainsbury) and Asda Group Ltd (Asda) applied to the Competition Appeal Tribunal for a judicial review of the Competition and Markets Authority’s (CMA) timetable and process in the context of its investigation into the proposed merger between the parties.
The proposed merger was referred by the CMA for an in-depth second phase review on 19 September, following a request from the parties to ‘fast track’ the referral in accordance with the CMA’s fast track reference procedure. For a case to be fast tracked, the CMA must have evidence “that it believes objectively justifies a belief that the test for reference is met”. In addition, the notifying parties must have requested and given their consent for the use of the procedure.
Having requested (and consented to) the use of the fast track procedure to accelerate the reference to Phase 2, Sainsbury and Asda are now taking the unprecedented step of challenging a decision by the CMA not to allow the parties an extension to the Phase 2 timetable over the Christmas period. According to a statement by Sainsbury, the application seeks a review of the “timetable and process, reflecting both Parties’ view that the current timetable does not give the Parties or the CMA sufficient time to provide and consider all the evidence given the unprecedented scale and complexity of the case”.
The CMA published a statement in response to the application for judicial review, stating that they “began to engage with the companies involved as soon as they announced their intention to merge” and “Investigating any merger of this size requires assessing a large volume of material in a short timeframe, and it is not unusual for the companies involved to do this in the timelines we have been working to with Sainsbury’s and Asda. We have done everything we can to aid their consideration of this work, whilst still ensuring we are able to meet our legally-binding deadline.”
The CAT found in favour of the applicants, quashing the CMA’s decisions on timing, but the full reasoning behind this decision has yet to be published.
The statutory deadline for the review is 5 March 2019.