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Scottish bus merger to lead to higher fares, says trading watchdog

The joint venture between Stagecoach and Scottish Citylink could lead to higher fares and reduced service levels for their coach passengers on the Glasgow-Aberdeen and Edinburgh-Inverness routes, the Competition Commission (CC) claimed on Friday.
The joint venture brought together Stagecoach's Megabus and Motorvator brands with Scottish Citylink, which had been their direct competitor on a number of routes in Scotland. The CC's provisional findings report concludes that the joint venture would lead to a substantial lessening of competition on the 'Saltire Cross' routes (the Glasgow-Aberdeen and Edinburgh-Inverness routes, crossing at Perth), given the removal of competition between Megabus and Scottish Citylink. CC Inquiry Chairman John Baillie said: 'Stagecoach's low cost Megabus service and Scottish Citylink were competing on these routes before the joint venture, to the benefit of passengers who could take advantage of the lower fares and other offers that resulted from this competition. 'By bringing together the only two effective coach competitors on these routes, our provisional view is that the joint venture has removed constraints on their fares and service levels.'In the absence of any competitive threat, it seems likely that passengers could face higher fares and reduced service levels.'We're now seeking views on suitable measures which will address the likely lessening of competition on the Glasgow-Aberdeen and Edinburgh-Inverness routes.'The joint venture was referred to the CC by the Office of Fair Trading (OFT) on March 15.As well as the provisional findings, the CC has also published on its website a notice of possible remedies to address the lessening of competition on the Glasgow-Aberdeen and Edinburgh-Inverness routes.Related links:Today's top stories

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