The OFT yesterday made a request to the European Commission (EC) to refer the UK aspects of the proposed joint venture between Orange UK and T-Mobile UK to the OFT.

The OFT’s initial view, following consultation, is that the joint venture threatens significantly to affect competition in mobile telecommunications in the UK.

If the request is granted, the OFT intends to examine the proposed joint venture with a view to deciding whether it should be referred to the Competition Commission for an in-depth investigation.

It’s hard to see how the OFT, if it gets to review the proposal, won’t conclude that the deal is a “relevant merger situation” that will result in a ” substantial lessening of competition” under competition law. Orange and T-Mobile said they would retain separate branding for 18 months but would “review branding alternatives” afterwards - ie. form a single operator. They’re also hoping to cut costs by identifying customer support as a savings area.

Orange and T-Mobile had wanted an inquiry to be conducted in Brussels, but rivals like O2 were keen that the UK conduct its own inquiry, Times Online reported. T-Mobile has been losing money in the UK and Orange could do with strengthening.