Decision to block Bass Brewers deal ruled "unfair

The Government's decision to block Interbrew's takeover of Bass Brewers could be overturned after it was attacked by the High Court.

Justice Alan Moses ruled today (May 23) that the Competition Commission's recommendation to Trade and Industry Secretary Stephen Byers (pictured)​ was "unfair".

The watchdog advised Mr Byers that acquiring Bass' brewing arm would give Interbrew, which also bought Whitbread Beer Company, too much control of UK beer supplies.

This led to the Government to order the Belgian brewer to sell the business, which it had bought for £2.3bn, within 12 months.

Justice Moses backed the commission's reasoning but said the process had been flawed.

"I am driven to the conclusion that there was such unfairness that [the Competition Commission's] decision cannot stand," he said. "It must follow that the Secretary of State's decision must also be set aside."

Justice Moses added that the watchdog had not given Interbrew enough opportunity to comment on a key aspect of the case.

However, any further comment has been deferred until after a second hearing that is due to take place in the High Court on Friday May 25.

The options available to the court include overturning the original decision or forcing the commission to review aspects of the ruling.

During a three-day judicial review at the beginning of May, Interbrew's lawyers attacked Mr Byers' announcement that Bass Brewers must be sold as "grossly disproportionate".

Before the hearing, Interbrew chief executive Hugo Powell said he hoped the court would give it more time to improve the Bass business and sell it at a "reasonable price". He maintained that it was not necessarily expecting Mr Byers' decision to be overturned.

Following the ruling, Interbrew issued a statement welcoming the news.

It said: "Interbrew remains committed to the UK, its customers, consumers and stakeholders in the UK beer market. The company looks forward to final discussions with the UK authorities as soon as practicable in order to obtain a fair and speedy resolution of this matter."

Prospective buyers rumoured to be interested in Bass Brewers include Heineken and South African Breweries.The Trade and Industry Secretary also ordered that the buyer, which was most likely to be Heineken or South African Breweries, must be approved by the Government.