Judgment of the Tribunal on the application of Ecolab Inc. (“Ecolab”) for review under s.120 of the Enterprise Act 2002 (“EA 02”) of the decision of the Competition and Markets Authority (“the CMA”) in its Final Report dated 7 October 2019.
In the Final Report, the CMA determined that Ecolab’s acquisition of Holchem has resulted or may be expected to result in a substantial lessening of competition (“SLC”) on the market for the supply of formulated cleaning chemicals (and ancillary services) to food and beverage (“F&B”) customers in the UK and required Ecolab to divest either all of Holchem or Holchem Laboratories. The CMA rejected an alternative divestiture proposal (“ADP”), put forward during the investigation by Ecolab, on the basis that it would not be effective, and a further modification to the ADP proposed by Ecolab
In its application Ecolab challenged, by way of judicial review, the decision in the Final Report on four grounds:
- the SLC decision was irrational and unsupported by the evidence;
- the rejection of the ADP was irrational, disproportionate and based on an error of law;
- to the extent that the CMA had doubts about the effectiveness of the ADP, it failed to take reasonable steps to investigate whether those doubts could be addressed; and
- in any event, the conclusion that the ADP would not be effective was irrational in light of the further modification of that remedy proposed by Ecolab.
For the reasons given in the judgment, the Tribunal unanimously dismissed all four grounds of the Application.
