OFT to launch market study into Isle of Wight ferry services

22/09 27 February 2009

The OFT has today announced that it is to launch a market study into Isle of Wight ferry services.

This study will focus on a local market where consumers are wholly dependent on a small number of suppliers and where price, quality and general service have a major impact. It follows a complaint to the OFT, supported by 8,000 signatures, alleging high prices, unclear charging and declining levels of service.

The study will examine the nature of competition between operators and potential barriers to entry. This will include looking at port ownership arrangements, route competition and pricing. Its findings are expected to be published in May 2009.

John Fingleton, OFT Chief Executive, said: 'People travelling to and from the Isle of Wight are reliant on ferries and they want efficient and competitive services that are responsive to their needs. This market study will examine whether there are serious problems in the structure of the market or with the process of competition and, if there are, whether there is any public intervention that could bring about improvements.'

A short document outlining the reasons for launching a study into Isle of Wight ferry services and the focus and timescales can be seen on the market study page.

The OFT will be contacting key parties directly. Other interested parties can submit written views, by 27 March 2009 to:

Isle of Wight Ferry Services Market Study (2C),
Office of Fair Trading,
Fleetbank House,
2-6 Salisbury Square,
London EC4Y 8JX

or email: isleofwightferries@oft.gov.uk

NOTES

1. According to the 'Cross Solent Movement Study' prepared for the Isle of Wight Council by MVA in June 2006 (based on statistics from Isle of Wight Tourism) there was a two-way total of 9.3 million passengers and slightly above 1.7 million vehicles that crossed the Solent in 2004.

2. OFT market studies are carried out under section 5 of the Enterprise Act 2002 (EA02) which allows a market-wide consideration of both competition and consumer issues.

3. Market studies involve an analysis of a particular market with the aim of identifying and addressing any aspects of market failure from competition issues to consumer detriment and the effect of government regulations. Possible results of market studies include; enforcement action by the OFT; a reference of the market to the Competition Commission; recommendations for changes in laws and regulations; recommendations to regulators, self-regulatory bodies and others to consider changes to their rules; campaigns to promote consumer education and awareness; a clean bill of health.

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