Editor: John Arnold. E-mail jarnold@creditman.co.uk
Pat Williams. E-mail pwilliams@creditman.co.uk
Site: Business Credit Management UK
URL: http://www.creditman.co.uk
Issue: Vol 6 Issue 7
Dated: 17 February 2002
Welcome to the Business Credit News UK.
In this weeks edition you will find the following topics.
CREDIT 2002, the definitive exhibition & conference for the UK commercial and consumer credit industry, plays host to the largest gathering of credit professionals in the UK, showcasing the complete range of credit related products, services & applications and the 'all new' Credit Management Conference - incorporating The Management Forum.
So, whether you are a senior executive within the financial world or a manager at the centre of a credit function, CREDIT 2002 is the IDEAL opportunity this year to witness, discover, interact and network with the leading figures of the Credit Management industry - worldwide. For more information and to REGISTER, please visit the website at www.credit-expo.co.uk
UKEU REACHES AGREEMENT ON HOW TO TAX DIGITAL SERVICES PROVIDED OVER THE INTERNET
The EU confirmed this week that European consumers buying services delivered electronically over the Internet (e.g. music, games, digital books or pay per view TV) from businesses outside the EU will have to pay VAT from July 2003. The move attempts to create a level playing field between EU and non-EU businesses, to simplify the VAT regime and to safeguard future tax revenues for the EU (until now such services from outside the EU have been VAT free).
Non-EU businesses will only have to register in one EU country when selling to EU consumers and record all sales within the EU in that one Member State. EU businesses will still have to account for VAT at the rate applicable in the country where the business is established.
Christine Sanderson, tax partner, PricewaterhouseCoopers said:
"Although non-EU businesses will only need to register in one EU member state, this does not mean a harmonised rate of VAT will apply. Non-EU businesses will still have to account for the local rate of VAT in each territory where they make a sale (ranging from 15% to 25%). This will add to the compliance burden for non-EU businesses.
"Under the old rules, EU businesses suffered a competitive disadvantage as non-EU businesses could sell digital goods over the Internet to consumers in the EU without having to charge VAT.
"A major flaw in this agreement, which even the EU authorities acknowledge, could be the difficulty in applying the principle in practice and enforcing compliance. More work needs to be done in this respect. The EU authorities are now committed to look at the practical details and will have to deliver realistic solutions. Given that the amounts of VAT at stake are admitted by the EU to be low at present, this may be an ideal test case for the concept of businesses having only one VAT registration in the EU and for the further needed simplification of the EU VAT regime."
This agreement is part of a wider EU proposal on the taxation of services supplied by electronic means. This includes a range of changes relating to services such as broadcasting and web hosting services.
Some non-EU businesses have lobbied the EU not to legislate in this area until an international agreement on how to tax digital goods and a 'compliance light' mechanism for collecting VAT had been made. Some EU businesses had expressed their concerns on the distortions of competition and the over-complexity of the VAT regime.
SMALL AND MEDIUM-SIZED MANUFACTURERS RECOVER FROM 11 SEPTEMBER SHOCK BUT STILL SUFFERING
Small and medium-sized manufacturers say orders and output have continued to decline but not as steeply as in the immediate aftermath of the terrorist attacks on the USA.
The CBI's latest survey of small and medium-sized enterprises (SMEs) suggests that September 11 gave businesses a one-off negative shock which produced sharp falls in confidence. Firms were already affected by the global slowdown and continue to be. But in the last few months the rates of decline in orders, output and optimism moderated compared with the sharp falls reported in October.
Twenty-four per cent of firms said total new orders were up over the last four months, 39 per cent said they were down. The balance of minus 15 per cent points to a more moderate decline than the minus 25 per cent recorded in the October survey and is not as bad as the forecast minus 23 per cent. Small firms reported a sharper drop in total orders than medium-sized ones.
Over the next four months an expected balance of minus nine suggests SMEs as a whole believe total orders will continue to decline but more modestly. Small firms are again more negative than medium-sized ones.
By contrast, the drop in export orders was worse than expected. A further, though less severe, decline is expected over the next four months. Asked about export prospects for the year ahead, medium-sized companies were much less optimistic than small ones. Over the past four months medium-sized firms suffered the strongest deterioration in export confidence. A balance of minus 40 per cent for medium-sized firms compares with minus 22 for small firms and minus 24 for SMEs as a whole.
With total new orders declining in the last four surveys, 39 per cent of firms now have less than a month's guaranteed production on their books, the most since this question was first asked of SMEs in 1988. Another 42 per cent have only between one and three months' worth of production.
Simon Bartley, Chair of the CBI's SME Council, said: "There is some reassurance in this survey. Manufacturers, particularly smaller ones, continue to face tough times with orders and output still suffering but the rate of decline is slowing. It also seems the slump in confidence in the immediate aftermath of September 11 was short-lived. Firms are a little less gloomy about their export prospects but some sign of a pick-up in global demand is desperately needed."
Business confidence continued to slide, but by less than in October. In this survey 13 per cent said they were more optimistic and 40 per cent less so. Prices remain the factor most likely to limit export orders. Political and economic considerations declined from the highest recorded figure in the last survey to a level last seen in April 1994.
Employment in SMEs has continued to decline and at a faster rate than expected. But fewer jobs are expected to be shed over the next four months, in contrast to the picture for manufacturing as a whole where job-cutting is expected to remain rife. Despite job cuts among SMEs, average unit costs increased modestly but prices continued to fall, indicating a squeeze on profit margins. That in turn is causing SMEs to cut their plans to invest in plant and machinery.
ECONOMIC OUTLOOK FROM THE INSTITUTE OF DIRECTORS
Ruth Lea, Head of the Policy Unit at The Institute of Directors, said that last week's economic data made it very unlikely there would be any interest rate cuts this year. January's retail prices inflation picked up and unemployment had unexpectedly dropped. But, as inflation is still relatively benign, large increases are not expected this year.
NEW EU REPORT CONFIRMS UK LEADS THE WAY IN REPRESENTING SMALL BUSINESSES
A report reviewing how each EU member state is implementing the Small Firms Charter has been published in Brussels by Erkki Liikanen the Commissioner for Enterprise and Information Society.
It shows the UK leads in championing the views of small businesses in Europe, and recommends that every country and the Commission itself "Thinks Small First" - the UK's slogan for putting its 3.7 million small business at the heart of policy-making.
The Minister for Small Business, Nigel Griffiths MP said:
"The UK is the first member state to take direct action to ensure small firms voices are heard not only nationally but in Europe by setting up 'smallbusiness|Europe'. This reflects our commitment to enterprise and implementing the European small firms charter."
The key aims of the charter include:
Run by small business for small business, the UK's new EU office in Brussels, smallbusiness|Europe was set up in April 2001 to represent and co-ordinate the views of UK small businesses, and act as an effective voice against over-regulation and bureaucracy. With £275,000 funding from the Department of Trade and Industry, it plays a constructive role in intercepting and influencing new regulations and legislation.
Mr Griffiths added:
"This landmark report puts the spotlight on back on small firms, recognising their central role in the economic activity of the European Union. There are 20 million small businesses in Europe that account for 99% of all businesses and provide employment to 65 million people so it is crucial the right environment is maintained for those businesses to flourish. The UK figures are 3.7 million SME's employing 12 million people, contributing £1 trillion a year to our economy - a vitally important sector!".
The 35-page annual report follows the declaration by Member States at Feira, Portugal in June 2000 to make the EU the best environment for small businesses in the world.
Nigel Griffiths has just returned from meeting Ministers in Madrid and Paris championing the requirements of small businesses.
The report reviews progress made by the Member States and the Commission since the adoption of the Charter in June 2000.
Member States and the European Commission reported on actions and measures taken to meet the commitments on ten lines of action contained in the Charter.
The Commission are obliged to provide an implementation report each year to the Spring Economic Summit to allow the European Council to monitor and evaluate progress.
Details of the report can be obtained at: http://www.europa.eu.int/comm/press_room/index_en.htm
AUTOMOTIVE SECTOR SEES DRASTIC FALL IN DEAL ACTIVITY
The global automotive sector experienced a massive 60 per cent drop in the value of deal activity last year down to $19bn from $46.1bn in 2000, following a fall in "mega-deals" caused by a weak economic outlook and slumping stockmarket values.
Figures in PricewaterhouseCoopers latest Automotive Sector Insights also reveal the number of transactions in the sector decreased by 20 per cent from 580 to 462.
Commenting on the driving factors behind the decline Philip Wylie, a corporate finance director at PricewaterhouseCoopers, said:
"The availability of finance has decreased significantly even in the past six months. Falling stock market valuations have further dampened takeovers because the car companies cannot use equity to finance deals."
The biggest fall in deal activity was in the vehicle manufacturing sector, which saw disclosed deal activity decline by 82% in 2001 from $12.5bn to $2.2bn.
Global "vehicle brand owners" remain committed to the globalisation of the manufacturing sector with the top 10 six largest (GM, DaimlerChrysler, Ford, Toyota, VW, Renault, Honda, PSA, Daewoo and BMW) controlling over 95% of global light vehicle production.
Philip Wylie added:
"We have almost certainly seen the peak in brand expansion takeover activity in the vehicle manufacturing arena. Further creeping takeovers, as vehicle manufacturers enlarge their equity shareholding in their affiliates, are likely to be the norm."
In the component sector, total disclosed deal value fell by around 58% in 2001, from $27.9bn in 2000 to $11.7bn in 2001, transactions falling by 19% from 272 to 221.
The retail, wholesale, aftermarket and leasing sector did, however, stand up to the test of poor economic conditions with the total value of transactions only marginally down in 2001.
Consumers, small businesses and solicitors can now make claims over the Internet to recover money owed to them by logging on to a new Court Service website, announced Michael Wills, Minister for the courts at the Lord Chancellor's Department.
Over 1.6 million claims were made in 2000 for money owed by one person to another - claims for unpaid debts, rent arrears or hire purchase payments; claims by suppliers of goods or services who have not been paid.
The Court Service is piloting a new online service, at www.courtservice.gov.uk/mcol, to allow consumers and businesses to make claims, for a fixed amount less than £100,000, from the convenience of their home or office 24hrs a day, 7 days a week. Nearly half of all homes now have Internet access but for those that don't, UK Online is providing access through a network of centres in, for example, schools, public libraries or community centres.
If the claim is undefended as most are - only 36,000 debt cases went to trial in the year 2000 - the money can be recovered without ever stepping inside a county court. Previously they would have had to either collect the forms from their local county court or print them off the Court Service website and then either return them to court in person or by post.
Michael Wills said:
"Going to court should always be a last resort. That is why the Government is promoting alternative ways of dispute resolution such as mediation or arbitration.
"However, there will always be some cases that need to go to court. The Court Service's new online service offers consumers, small businesses and solicitors the choice of making these claims online at a time and place convenient to them. Providing the claim is not defended, a creditor can recover a debt over the Internet, without ever going to a county court. There is an extensive online guide to help users of the new service and they can even pay the court fee by credit or debit card and check the progress of their claim over the Net.
"This is a significant step forward in our programme to modernise the courts, making them more accessible and providing a service that suits the needs of the people that use them, rather than the people that run them."
Ian Magee, Chief Executive of the Court Service said:
"The launch of the money claim online pilot is the Court Service's first step into interactive electronic services and is a significant milestone on the road towards meeting the Government's target of providing services on-line by 2005.
"We expect to have 25,000 claims made using the new online service by the end of this year. It will be quicker and easier to use for parties - and will take some pressure off court staff too. Later in the year the online service will be extended to larger solicitors' firms who have their own case management systems and to provide a fuller on-line service for defendants. All this will provide a more accessible and convenient service for people who need to use the courts."
After registering with the new secure website site, developed for the Court Service by EDS and EzGov, claimants create a user ID and password which they will need to use each time they log on. They then type in the name and address of the person who owes them money, the amount owed and details of their claim such as the goods and services provided and invoice numbers. The court fee will then be calculated automatically - £27 minimum - and which must be paid by credit or debit card. A statement of truth must then be "signed" by typing their name before the claim can be submitted.
The claim is then sent electronically to the County Court Bulk Centre in Northampton for issue in the name of Northampton County Court usually on the same day the claim is made. Claimants will be provided with a claim number to allow them to check the progress of their claim on-line, for example to see if the defendant has filed a defence, they can also enter judgment and apply for a warrant of execution over the Internet.
As with the current system, defendants receive the claim and response pack by post and will have 14 days to respond. They can then file an acknowledgement of service or defence online but a part or full admission of a claim still has to be filed by post. If the claim is defended it will be transferred to the defendant's (or the claimant's if the defendant is a business) local county court for trial.
Lord Justice Brooke, appointed by the Lord Chief Justice as judge in charge of modernisation, said:
"The judges welcome the launch of this new service for claimants. Our wish is that it should eventually be made easier for both claimants and defendants to communicate electronically with the courts. This is an important step down that road."
Andrew Pinder, the Government's e-envoy said:
"We're delighted to see this service launched. There are an increasing number of services being designed by the Government, which are looking at the needs of the citizen and how technology can help. This is one such service. By putting this service online, the Court Service is to be congratulated in creating a system which can help people avoid the need for what can be a lengthy and sometimes intimidating court process."
Both the defendant and claimants using the online service have to be over 18 and live in England and Wales, claims must be against no more than two people and claimants cannot be on legal aid or a 'vexatious litigants'. Personal injury claims are not suitable for the online service as they will be for an unspecified amount of money.
In addition to the online guide at www.courtservice.gov.uk/mcol there is a help desk at the County Court Bulk Centre for users who need additional support tel: 0845 6015935.
Once users become familiar with the new online service they can log on direct at: moneyclaim.gov.uk
The one-off project costs are: £1,841,000 for design and development and £206,170 for project costs making a total of £2,047,170. There will also be a yearly service charge of £885,000.The project has been delivered by the Court Service's existing PFI supplier, EDS Ltd., and links into existing systems for case management and document production at the Court Service's Bulk Centre in Northampton. Operational staffing costs to support the pilot project are approximately £48,000.
Civil Procedure Rules Practice Direction 7e provides for a pilot scheme, 'Money Claim Online' to operate from 17th December 2001 to 16th June 2003 (the site was operational but at testing stage between 17 December and the public launch on 4 February 2002). The Practice Direction is accessible via the LCD website:
http://www.lcd.gov.uk/civil/procrules_fin/contents/practice_directions/pd_part7e.htm
Making a claim over the Internet was first proposed in the Court Service consultation paper, Modernising the Civil Courts, published on 15 January 2001. The proposals resulting from this consultation will be published in the spring.
To find out more about UK Online visit: www.letsallgeton.gov.uk or call 0800 77 1234 to find out where to get online anywhere in the UK.
For further information about EzGov contact Sharon Emanuels tel: 00 31 20 596 1241, e-mail: semanuels@ezgov.com
For further information about EDS contact Charlotte Steele tel: 020 7569 5135, e-mail: charlotte.steele@eds.com
10 PEOPLE ARRESTED ON ALLEGED MULTI - MILLION POUND VAT MISSING TRADER FRAUD
HM Customs & Excise Law Enforcement officers last week raided over 25 properties in the Midlands, northern England and south east England in connection with a major VAT missing trader fraud. In the first joint operation of its kind, simultaneous visits were carried out at 6 companies in the Republic of Ireland by officers from the Irish Revenue Commissioners.
7 men and 3 women have been arrested as part of Operation Televise. The people are believed to be part of a sophisticated network of companies that "carousel" large quantities of high value computer processing units between the UK and Ireland.
Chris Pygall, Assistant Chief Investigation Officer for Customs and Excise said: "VAT missing trader fraud is a systematic attack on the VAT system, detected in many EU Member States, and carried out by serious organised criminals.
Customs are determined to clampdown hard on VAT missing trader fraud and this joint approach with the Irish revenue officers illustrates our commitment to tackling those involved wherever they may be."
Investigations are continuing.
VAT missing trader fraud/carousel fraud is where fraudsters obtain VAT registration to acquire goods VAT free from other Member States. They then sell on the goods at VAT inclusive prices and disappear without paying over the VAT paid by their customers to the tax authorities.
Customs have deployed 340 staff to tackle this type of fraud and aim to halve fraud losses by 2003-04.
The government set out in Tackling Indirect Tax Fraud, published in November 2001, its plans and proposals to tackle VAT missing trader fraud.
EXPERIAN LAUNCHES NEW VERSION OF INTACT WITH FREE MOSAIC PROFILING AND LATEST DATA REFERENCE LISTS
Experian Intact announces 80 million records cleansed online since May 2001
Experian, the UK’s leading provider of marketing services has announced at the Technology for Marketing Show a comprehensive upgrade of its online data cleansing service Experian Intact (www.experianintact.com). Experian Intact has been enhanced to offer clients increased functionality through free MOSAIC analysis, access to new data reference lists and new customer profiling tools.
Experian Intact was launched as Europe’s first online data cleansing service in May 2001. New figures from Experian show that to date Intact has processed over 80 million records, corrected 4.5 million addresses and has provided telephone numbers for over 35 million individuals. In order to help clients comply with the 1998 Data Protection Act, Experian Intact has also been able to identify almost 3 million individuals who have chosen not to receive direct marketing communications by joining the Telephone, Fax and Mail Preference Services.
Experian Intact already offers clients a free data audit and through the new version will now be able to offer customers a free analysis of their records using the MOSAIC segmentation system. Users will be given a MOSAIC code for their data, which can be used to purchase additional ‘look-a-like’ records directly from Experian Prospect Locator (www.prospectlocator.com). This option will allow clients to quickly and accurately increase the size of their prospecting database. Experian Intact will also be offering profiling using demographic data from a variety of data sources.
In order to continue to give Experian Intact access to all commercially available lists, clients will now be able to have their data screened against The Deceased Register
from Active Media as well as Experian’s own deceased list. For the first time, clients using Intact will be able to have their records suppressed against public default records.
Another new element of Experian Intact is the option to have cleansed databases returned with a Mailing File, which contains only those records suitable to be mailed straight away, helping increase the speed at which clients can deploy their campaigns.
Qbase, the leading Marketing Database Agency, which handles campaigns for Tiscali and Newsweek has been trialling the new version of Experian Intact. Ian Johnstone, Partner at Qbase commented, "We are very pleased with the new version of Intact. Experian has made the user interface even more intuitive and the new additions make the screening more comprehensive".
David Coupe, Managing Director of Experian’s Marketing Services division, said: "The improvements to Experian Intact will make online data cleansing even more appealing. Clients can now use Experian Intact to comprehensively cleanse their data and also as a starting point to profile their existing customers and then acquire a larger customer base by using Experian’s prospecting services."
WOULD YOU LIKE TO CONTRIBUTE ARTICLES TO THIS NEWSLETTER?
If you are interested in your business receiving high profile and would like to contribute articles and news which would be of interest to our readers please email jarnold@creditman.co.uk now.
It has been reported that the number of businesses collapsing in Scotland soared by nearly 40% in the last three months of 2001 with a total of 237 ceasing to trade. The fear is that the position will get worse in the immediate future. There have been some high profile insolvencies already since January.
Out of the 91 companies which were put into liquidation in October 2001 many were in the construction and engineering sectors.
Leading Scottish commentators are concerned these figures could reflect badly on Scottish business confidence with investment decisions being put back. There is no doubt the business environment is tougher and with the possibility of a rise in interest rates business traders are expressing concern.
If you are worried about any debts due to you by a Scottish company and concerned about payment why not talk to us? It may be a simple reminder letter from Yuill & Kyle at a cost of £3:00 will do the trick. Alternatively if the position is more serious you may want to take a look at our "fast track" recvery service.
All of these services can be found on our website at www.debtscotland.com Alternatively please feel free to give me a call on 0141 572 4251 if you are at all concerned about a bad debt.I'll be happy to advise on the best recovery tactics.
Stephen Cowan
Yuill & Kyle,Debt Recovery and Credit Control lawyers,Scotland
scowan@yuill-kyle.co.uk
BEYOND.COM - USA
On the January 24, 2002, Beyond.com Corporation, Inc. ("Beyond.com") filed a voluntary petition for protection under Chapter 11 of the U.S. Bankruptcy Code in the United States Bankruptcy Court for the Northern District of California, Case Number 02-50441. If you have any questions regarding the status of Beyond.com, please contact Amy E. Wallace, Attorney for Debtors, at Gray Cary Ware Freidenrich, LLP, 1755 Embarcadero Road, Palo Alto, California 94303.
FAMOUS ARMY STORES LTD (IN ADMINISTRATION) - SALE ANNOUNCEMENT
Administrators of the Famous Army Stores, have announced that they have been successful in securing the future of 47 of the remaining Famous Army Stores.
Russell Cash, one of the PricewaterhouseCoopers joint administrators, said:
"We are delighted that the future of 47 of the remaining stores has been secured following the acquisition by Blacks Leisure Group. We are hopeful that we will be able to assign a number of leases relating to other stores in the near future."
Simon Bentley, Chief Executive of Blacks Leisure Group, said:
"The recent failure of Famous Army Stores has presented the Group with an opportunity to add some good sites to its Outdoor portfolio and expand the business significantly. The acquired premises will be converted to our own Outdoor fascias, principally Millets but also Blacks at some selected sites, and will strengthen further our position as UK market leader in outdoor retail."
*** FORTHCOMING CREDITORS MEETINGS ***
For detailed information on the British Isles insolvency's (liquidation's, receiverships, administrations, dividends, creditors) please visit http://www.insolvency.com/cgi-bin/gazette/liq/nots.plNEW SERVICE COMING SOON! WATCH OUT FOR OUR ANNOUNCEMENTS!!
TW LW TW LW
USA 1.43 1.41 Canada 2.28 2.27
Austria 22.59 22.43 Portugal 329.18 327.13
France 10.77 10.70 Belgium 66.23 65.82
Finland 9.76 9.70 Italy 3179.19 3159.51
Germany 3.21 3.19 Sweden 15.17 15.03
Holland 3.61 3.59 Switzerland 2.43 2.39
Spain 273.19 271.51 Ireland 1.29 1.28
Australia 2.82 2.79 Denmark 12.19 12.12
Hong Kong 11.20 11.03 Euro 1.64 1.62
Africa Com 16.53 16.31 Saudi Arabia 5.38 5.30
India 69.90 68.87 Malaysia 5.45 5.37
Singapore 2.62 2.59 Norway 12.83 12.75
Japan 190.95 189.57
TW This week LW Last week.
BP reported that profits had plunged in the fourth quarter by 46%, compared with a year ago, to $2.2 billion.
ABB reported its first-ever annual loss of $691m for 2001.
NTL and Telewest, two British cable-TV broadcasters, are in discussion about a merger to create a national rival to Rupert Murdoch's BskyB.
Dupont announced that it would spin off its textiles division, which includes Lycra, the legging material of choice to 1980s heavy rockers and fitness fanatics.
Allied Irish Banks admitted that it had drawn up plans to tighten trading controls over a year before a $750m loss suffered after a fraud by a foreign-exchange dealer, John Rusnak.
Source - The Economist
Cadbury Schweppes announced pre-tax profits of 813 million pounds, after exceptional charge, on turnover of 5,519 million, for the year ending 30th December 2001. Earnings per share stand at 27p.
Galen, the drugs company, announced pre-tax profits of 12.9 million pounds, after exceptional credit, on turnover of 53.7 million, for the three months ending 31st December 2001. Earnings per share stand at 5.2p, on increased capital.
Liberty International, the offices and shopping centre company, announced pre-tax profits of 90.9 million pounds, after exceptional credit, on turnover of 331 million, for the year ending 31st December 2001. Earnings per share stand at 27.6p.
Royal Doulton announced pre-tax losses of 21.2 million pounds, after exceptional charge, on turnover of 165.8 million, for the year ending 31st December 2001.
Tolent announced pre-tax profits of 2.38 million pounds, on turnover of 153.7 million, for the year ending 31st December 2001. Earnings per share stand at 12.9p.
MERGER NEWS
The Secretary of State for Trade and Industry has decided, on the information at present before him, and in accordance with the recommendation of the Director General of Fair Trading, not to refer the following merger/s to the Monopolies and Mergers Commission under the provisions of the Fair Trading Act 1973:Completed acquisition by Topland Group Holdings Ltd of Diamond Property Holdings Ltd, namely 78 Marks and Spencer plc stores
Proposed acquisition by Rotem Holding GmbH of Cleveland Potash Limited
Completed acquisition by Automotive Safety Components International of a division of Woodville Polymer Engineering
ACQUISITION OF MARLEY BUILDING MATERIALS BY H+H CELCON REFERRED TO COMPETITION COMMISSION
The proposed merger between H+H Celcon Ltd and Marley Building Materials Ltd. is to be referred to the Competition Commission by the Trade and Industry Secretary, Patricia Hewitt.
The decision follows a recommendation by the Director General of Fair Trading who advised that the merger might raise competition concerns particularly in the supply of aircrete blocks to the construction industry.
The decision to make a reference does not in any way prejudge the question of whether or not the proposed joint venture would be against the public interest. It is for the Competition Commission to report on this after investigation. The Commission is to make its report by 27 May 2002.
The Fair Trading Act 1973 empowers the Secretary of State to refer to the Competition Commission actual or proposed mergers which create or increase a market share of 25% of the supply of particular goods or services in the UK or a substantial part of the UK, or involve the take-over of assets exceeding £70 million. Once a reference has been made, the Competition Commission investigates the merger and delivers a reports to the Secretary of State on whether or not the merger will operate against the public interest. If a merger is found to operate against the public interest, the Commission may recommend possible remedies.
INQUIRY INTO THE ACQUISITION OF McKECHNIE PAXTON HOLDINGS LIMITED BY LINPAC GROUP LIMITED
Statement of Issues and Hypothetical Remedies
The Competition Commission has sent an issues letter, which also lists some hypothetical remedies, to the Linpac Group Limited.
Such letters are always sent to main parties in a merger inquiry, before the Commission has reached any conclusions. They are designed to highlight the matters which have been identified by the investigating group for further consideration. This statement is being made public now to give interested parties an opportunity to bring to the Commission's attention, in the next two weeks, any further points that they wish to see raised. The Commission has reached no conclusions about whether any matters operate or may be expected to operate against the public interest and will not do so until after it has discussed these issues with the Linpac Group.
The issues the Commission is likely to consider are:
a) The appropriate definition of the economic markets affected by the acquisition, in particular:
- whether the UK is the relevant market in all cases or whether, for some products, the market is different, and, if so, why;
- whether - in terms of products, geographical definition, customers or otherwise - there is a single market (or a distinct segment of a market) for returnable transit products (RTPs), or several distinct markets, or whether they are part of a larger market;
- whether there is a single market (or a distinct segment of a market) for other plastic-based, transit packaging items, or several distinct markets, or whether they are part of a larger market;
- whether there is scope for substitution at the boundaries of any of the markets identified; and, if so
- whether that substitutability is affected by seasonal , or other, considerations.
b) Whether the acquisition is likely to affect competition in any of the markets identified in the UK, and, in particular:
- whether the acquisition is likely to lead ultimately to a significant rise in prices, or to a reduction in quality or levels of service, for customers of these products;
- whether any practices- such as collusion, price discrimination, manufacturers forcing full lines of products onto customers, or predatory pricing - may be expected to come into existence or be exacerbated as a result of the acquisition;
- whether, as a result of the market conditions created by the acquisition, other suppliers of RTPs, or of other plastic-based, transit packaging items to customers in the UK, would be seriously weakened;
- whether there are significant barriers to entry or expansion in the relevant markets, such as:
c) Whether there are likely to be benefits to the public interest from the acquisition; if so:
- what are they likely to be; and
- to whom will they accrue.
d) In the event of the Commission finding that the acquisition was expected to operate against the public interest, what remedies, behavioural or structural, would be appropriate to deal with the adverse effects identified:
- a partial or complete divestment of one or more of Linpac's UK subsidiaries operating in these markets;
- a divestment, by Linpac, of vertically integrated logistics businesses using RTPs, and an undertaking, not to recreate any;
- an undertaking to make transparent to customers that Paxton is now part of the Linpac group, and no longer a competitor;
- undertakings about the prices charged for RTPs or other plastic- based, transit packaging items, or about the mechanisms by which they are set; or
- any other remedies.
Alexander drives forward e-agenda with minerals and construction products sector
E-commerce is more than just about connecting to the internet. It is about transforming businesses and adopting new ways of working, Douglas Alexander, E-commerce Minister today told key representatives from the minerals and construction products industry.
Speaking at a seminar for the industry, Mr Alexander launched an e-commerce impact assessment report for the sector. The report highlighted the positive effect that e-commerce has had upon the industry, and identified the benefits of integrating e-commerce into everyday business practice.
Mr Alexander said:
"The minerals and quarry products industries play a key role in the competitiveness and success of many other UK industries.
"E-commerce is central to the future growth and competitiveness of the UK. It encourages growth, breaks down barriers and allows companies to compete in global and increasingly sophisticated new markets.
"It is vital that all industries continue to take up the challenge and feel the benefits that e-commerce can deliver, so that they can play their part in advancing our e-commerce agenda."
The seminar, attended by more than 100 industry representatives, drew upon a number of key case studies from the sector. It highlighted the range of support and advice available to the sector through the Government's uk online for business initiative. It also discussed the way forward for the industry.
The impact assessment report is part of a wide-ranging DTI programme, examining the use of e-commerce across a wide variety of key business sectors in the UK.
The studies will assist the DTI in delivering policy to accelerate the take-up of e- commerce by businesses to the benefit of the wider economy.
A copy of the report is available at http://www.ukonlineforbusiness.gov.uk/Government/impactstudies.htm The uk online for business website (www.ukonlineforbusiness.gov.uk) gives a full range of advice and guidance for businesses on how to get the most from e-commerce.
The series of studies were developed following the publication of the Performance and Innovation Unit report on e-commerce - "e-commerce@its.best.uk". The report recommended a series of sector-specific e-commerce impact assessments be undertaken to identify opportunities, threats, and barriers in each sector.
18 - 22 February Advanced Credit Analysis FT Knowledge Course 80 Strand, London For further details tel 020 7010 2508 Website www.nyif.com/emea Email finlearn@ftknowledge.com Friday 22 February 2002 Debt Sale & Purchase Credit Today, Savoy Hotel, London The second annual debt sale and purchase conference chaired by Rob Levick. For details e-mail carleen@credittoday.co.uk 6 - 7 March 2002 Softworld Accounting & Finance Software and E-business event. Grand Hall, Olympia, London Register in advance at http://www.softworld.co.uk/afs2002/register.html 11-13 March 2002 BCR's 2002 Receivables Finance International Conference Four Seasons Hotel, Singapore Website http://www.factorscan.com/static/asianpacific.htm Tel: +44 208 466 6987 Fax: +44 208 466 0654 Email mb@bcrpub.co.uk Wednesday 13 March 2002 ICM National Conference and Exhibition Heritage Motor Centre, Gaydon near Warwick For full details tel 01780-722907 or e-mail training@icm.org.uk Monday 25 March Wessex Branch of the ICM meeting Do Not Get Stung by Guarantees Presented by Jo Johnson of Moore Blatch Solicitors Royal Southampton Yacht Club Southampton 7.00pm for registration and refreshments 7.30pm Speakers 4 April Credit Today Awards 2002 Grosvenor House Park Lane London Black Tie Single Booking 120.00 plus vat. 10% discount to Credit Today subscribers Telephone 01403-786-726 or 020-7407-4700 E-mail sgc@mag-subs.demon.co.uk or awards@credittoday.co.uk or visit www.credittoday.co.uk 7 - 13 April The Credit Academy, 7 day Residential Course FT Knowledge Financial Learning London, 80 Strand, WC2R 0RL Contact Jane Lees - E-mail jane.lees@nyif.com Tel +44 (0)20 7010 2568 17 and 18 April Credit 2002 - The Definitive Event for the Commercial and Consumer Credit Industry Brompton Hall, Earls Court, London For more information contact vtolson@advanstar.com Website www.credit-expo.co.uk 22 - 28 April The Credit Academy, 7 day Residential Course FT Knowledge Financial Learning Venue - Hong Kong, location tbc Time: 08.30 Contact Jane Lees - E-mail jane.lees@nyif.com Tel +44 (0)20 7010 2568 10 - 16 June The Credit Academy, 7 day Residential Course FT Knowledge Financial Learning Venue - New York, location tbc Contact Jane Lees - E-mail jane.lees@nyif.com Tel +44 (0)20 7010 2568 21 June The ICM Fellows Luncheon Churchill Room, The House of Commons Westminster, London Guest Speaker Norman Lamb MP Cost 49.50 GBP inc of vat and all drinks Contact ICM Training Department on 01780-722907 E-mail sheila@icm.org.uk 3 to 5 July Receivables Finance International Europe (2002) Marriott Hotel, Prague Tel: +44 208 466 6987 Fax: +44 208 466 0654 Email mb@bcrpub.co.uk Wednesday to Friday 9 to 10 October International Credit Exhibition & Conference Raffles City Convention Centre Level 4 Swissotel Singapore , The Stamford Singapore Website http://www.internationalcredit001.com/ E-mail info@internationalcredit001.com If you have an event coming up which is credit management related and you would like us to make an entry in the Diary section please e-mail the details to jarnold@creditman.co.uk
Alternatively you may use the email interface. email creditman-request@mailing-list.cyberstrider.net with the word Help in the subject line for details.
Business Credit Management UK: John Arnold jarnold@creditman.co.uk
Business Credit News UK: Pat Williams pwilliams@creditman.co.uk