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OFT approval for national address database

UK: Office of Fair Trading (OFT) has approved plans to create definitive national address database for England and Wales. The plans were unveiled by Eric Pickles MP, Secretary of State for Communities and Local Government, in December 2010.

The OFT approval will result in addressing information from local government and Ordnance Survey (OS) being brought together to create one definitive source of accurate spatial address data for England and Wales. To enable the delivery, and management, of the address database OS and the Local Government Group have created a joint venture called GeoPlace LLP.

Over the next few weeks GeoPlace will continue to work on its plans with an aim of being fully operational in April 2011. It is anticipated that data resulting from the partnership will be made available in the summer/early autumn of 2011.

This data is relied upon by the public and private sector to accurately locate addresses when delivering services such as public transport, road maintenance, utility management and emergency call-outs.

The OFT found that the parties provide the only two accurate geo-referenced addressing databases, and do not face competition from less frequently updated and geographically accurate databases, such as those used by satnavs. Consequently it found that the joint venture would create a monopoly in this market. However, the OFT concluded that it was not proportionate to refer the market to the Competition Commission because:
– The Government is the parties’ largest customer and will continue to enjoy substantial buyer power and influence over the joint venture.
– In practice there has been limited opportunity for the private sector customers of the two parties to trade one off against the other, and in any case the size of the affected private sector market is relatively small and
– Virtually all customers, both public- and private-sector, strongly supported the creation of the new database.

Amelia Fletcher, OFT Chief Economist and decision maker in this case, said, “Comprehensive and accurate spatial addressing information is important in delivering frontline public services, as well as for certain private sector customers, so any competition concerns resulting from the joint venture needed careful consideration. A merger to monopoly would normally warrant further investigation. However, the Government’s buying power, combined with expected benefits from combining these two databases, made a reference to the Competition Commission disproportionate.”

Source: OS & OFT